Are District Presidents More Conservative than Board Governors?

by Geoffrey M. B. Tootell
September/October 1991

It is widely believed that the Federal Open Market Committee policy votes of Federal Reserve Bank presidents are more "conservative" than those of their Board governor counterparts. In both academia and Congress, the suspicion runs deep that the political appointment procedure exercised over Federal Reserve Board governors-nomination by the President and confirmation by the Senate-results in monetary policy that is more concerned with output and less concerned with inflation than the policy produced by the more politically independent District Bank presidents.

This article examines the data to determine whether it supports this conventional wisdom. The statistical techniques used in this paper permit a test of the hypothesis necessary to support their conclusions. The evidence rejects the conclusion that significant differences exist.

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