In October 1979, the Federal Reserve changed its policy of using finely tuned interest rate adjustments and
Question:
In October 1979, the Federal Reserve changed its policy of using finely tuned interest rate adjustments and instead began targeting the money supply. Using the data in INTDEF, define a dummy variable equal to 1 for years after 1979. Include this dummy in equation (10.15) to see if there is a shift in the interest rate equation after 1979. What do you conclude?
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Let post79 be a dummy variable equal to one for years after 1979 and zero otherwise Adding ...View the full answer
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Related Book For 
Introductory Econometrics A Modern Approach
ISBN: 9781337558860
7th Edition
Authors: Jeffrey Wooldridge
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