The question of whether monetary policy should be guided by legislated rules or left to the discretion of the policymaker has been a subject of debate since the early days of central banking. An important episode of the debate occurred in the 1920s when Kansas Congressman James Strong introduced...

A measure of the public’s expectation of inflation would assist the Fed in formulating monetary policy. In order to create such a measure, the U.S. Treasury could issue its debt in two forms: standard debt and debt indexed for inflation. The difference in yield on these two forms of debt would...

Consistent with its mandate in the Humphrey-Hawkins Act of 1978, the Federal Reserve System each year sets a calendar-year target for the monetary aggregate M2. This paper examines the effect of specifying the M2 target as a multiyear trend line and concludes that an operationally significant...

An abstract for this article is not available

This article provides an analytical framework for discussing the monetary responsibilities of a central bank. The framework shows how the central bank gives the price level a well-defined equilibrium value and how the central bank causes this equilibrium value to change over time.

The Neal Resolution, now in Congress, would make price stability the dominant goal of monetary policy. The first of these two articles holds that policymakers’ discretion over the price level increases political conflict. Further, it argues that removing this discretion would restore the...

The Neal Resolution, now in Congress, would make price stability the dominant goal of monetary policy. The first of these two articles holds that policymakers’ discretion over the price level increases political conflict. Further, it argues that removing this discretion would restore the...

An abstract for this article is not available.