Regional Banking Instability and FOMC Voting

Stefan Eichler, Tom Lähner and Felix Noth

No 15/2016, IWH Discussion Papers from Halle Institute for Economic Research (IWH)

Abstract: This study analyzes if regionally affiliated Federal Open Market Committee (FOMC) members take their districts' regional banking sector instability into account when they vote. Considering the period from 1978 to 2010, we find that a deterioration in a district's bank health increases the probability that this district's representative in the FOMC votes to ease interest rates. According to member-specific characteristics, the effect of regional banking sector instability on FOMC voting behavior is most pronounced for Bank presidents (as opposed to governors) and FOMC members who have career backgrounds in the financial industry or who represent a district with a large banking sector.

Keywords: FOMC voting; regional banking sector instability; lobbying (search for similar items in EconPapers)
JEL-codes: E43 E52 E58 G21 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-ban, nep-cdm, nep-mac, nep-mon and nep-pol
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https://www.econstor.eu/bitstream/10419/141305/1/859169065.pdf (application/pdf)

Related works:
Working Paper: Regional Banking Instability and FOMC Voting (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwhdps:iwh-15-16

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