Does Monetary Policy Matter? Narrative Versus Structural Approaches

16 Pages Posted: 4 Jan 2007

See all articles by Ray C. Fair

Ray C. Fair

Yale University - Cowles Foundation; Yale School of Management - International Center for Finance

Date Written: July 1989

Abstract

This paper compares results from the narrative approach of Romer and Romer (1989) to those from the structural approach regarding the effects of monetary policy on real output. The results from both approaches lead to the conclusions that monetary policy matters and that the effects build slowly following a monetary policy shock. The narrative approach, however, leads to larger and more persistent effects than does the structural approach. Reasons are advanced in the paper as to why this might be so.

Suggested Citation

Fair, Ray C., Does Monetary Policy Matter? Narrative Versus Structural Approaches (July 1989). NBER Working Paper No. w3045. Available at SSRN: https://ssrn.com/abstract=375300

Ray C. Fair (Contact Author)

Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

Yale School of Management - International Center for Finance ( email )

Box 208200
New Haven, CT 06520
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

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