unconventional monetary policy: an examination of the effects of quantitative easing on the american economy

Open Access
Author:
Baldassarre, Robert John
Area of Honors:
International Politics
Degree:
Bachelor of Arts
Document Type:
Thesis
Thesis Supervisors:
  • David Lynn Lowery, Thesis Supervisor
  • Gretchen G Casper, Honors Advisor
Keywords:
  • Economy
  • International Political Economics
  • Quantitative Easing
Abstract:
Following the 2008 Global Financial Crisis a number of the world’s leading economic nations adopted unconventional monetary policies, specifically quantitative easing. This thesis seeks to explore the theoretical conceptions of quantitative easing as a monetary policy and its effects on a market economy. Through the implementation of a multiple interrupted time-series analysis the three individual rounds of quantitative easing executed by the Federal Reserve of The United States of America will be examined. This analysis provides further support with regard to current literature that quantitative easing may not necessarily induce rapid inflation or deflation. Furthermore, the multiple interrupted time-series analysis suggests that quantitative easing did not have a substantial effect on the value of the American Dollar with respects to the Euro and did not directly result in an increase in monthly employment figures. An extended analysis of the net percentage of bank loans tightening standards for business and consumer loans offers mixed results, but has proven that the 2008 financial crisis itself heavily dictated bank lending.