St Louis Fed paper denies direct Fed link to 1930s recession
A Federal Reserve of St Louis paper, published on Tuesday, examines whether the doubling of reserve requirements by the Fed in the late 1930s pushed the US into recession.
Charles Calomiris and Joseph Mason, the paper's authors, use microeconomic data to gauge the fundamental reserve demands of Fed member banks and whether the doubling of reserve requirements produced a contraction of money and credit, thereby facilitating the recession in 1937 to 1938.
Calomiris and Mason find the doubling of
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