Abstract :
In thestandardpolicymodel,apolicymakeroptimizesthewelfareofarepresentative
agent.Inpractice,policiesarechoseninapoliticalprocessbyagentselectedbyvoters.
Drawingonevidencefrommytwo-volumehistoryoftheFederalReserve,thepaper
reportsmanyexamplesofdecisionsinfluencedbypoliticalpressures.Thehistoryshows
that themeaningoftheindependenceoftheFederalReservechangedovertime
reflectingpoliticalinfluences
