Supplement to "Trade Dynamics in the Market for Federal Funds"
This appendix consists of three sections. Efficiency: in this section we use the theory to characterize the optimal process of reallocation of reserve balances in the fed funds market by studying the problem of a social planner who can reallocate reserves subject to the same bilateral trading technology available to private agents and shows the equilibrium. Data: in this section we describe the data and estimation procedures used in the quantitative implementation of the theory. Quantitative Exercises: in this section we conduct supplementary policy experiments and robustness exercises.
Supplemental Authors:
AFONSO, GARA M. - Federal Reserve Bank of New York
Lagos, Ricardo - New York University
Miscellaneous