An Episodic History of Modern Fed Independence

The authors supplement the existing empirical literature on Fed independence with a contextualized episodic history to corroborate the empirical literature and inform future studies. They examine the postwar Fed to focus on the ability of the Fed to forge a monetary path independent of political influence in modern times. They find that the Fed regularly accommodates debt, succumbs to political pressures, and follows bureaucratic tendencies, compromising the Fed’s operational independence.