Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/277404 
Year of Publication: 
2018
Citation: 
[Journal:] European Journal of Economics and Economic Policies: Intervention (EJEEP) [ISSN:] 2052-7772 [Volume:] 15 [Issue:] 1 [Year:] 2018 [Pages:] 32-46
Publisher: 
Edward Elgar Publishing, Cheltenham
Abstract: 
Federal Reserve Chairman William McChesney Martin famously declared that the Federal Reserve 'is in the position of the chaperone who has ordered the punch bowl removed just when the party was really warming up.' This paper uses the punch bowl metaphor to analyse how the Federal Reserve can improve monetary policy so as to deliver shared prosperity with greater financial stability. The problem is the party starts earlier on Wall Street than Main Street, so the Fed may remove the punch bowl before the party reaches Main Street. Ensuring Main Street attends the party requires a new recipe for the punch, new serving rules, and a new punch master. Additionally, there is a deeper problem that the current neoliberal growth model has the economy addicted to monetary punch. Resolving that requires a cure that goes beyond the punch bowl.
Subjects: 
monetary policy
punch bowl
quantitative regulation
asset-based reserve requirements
policy rules
wage targeting
JEL: 
E50
E52
E58
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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