I asked this question: How do reserves move between the 12 federal reserve banks?, but I'm not sure if it is on topic or not.

As a professional, knowing the answer would be useful, but I can see it is rather "dull" from an pure economics point of. I.e. it is a question about a practical implementation detail of a specific economic system.

In a sense I suppose it would be like asking about experimental equipment technique in the physics SE, or possible even an engineering question...

Some examples of other things that might get asked about that could be similar might be:

  • Questions about QE structuring (e.g. what SPVs own what)
  • Details about X12-ARIMA
  • Questions about how economic indicators are calculated (E.g. Who is selected to participate in the Non-Farm payroll survey)

So, do we want to just stick to "economic theory" or are these practical, if boring, questions on topic?


I think such questions are very important because it is precisely the answers to these which are time-consuming to find in books or journals and where having direct access to other experts through a site like this can add value. I don't find the question 'boring' at all.

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    $\begingroup$ (+1) A very accurate remark, that it is knowledge like this that you cannot find in the litareture. $\endgroup$ – Alecos Papadopoulos Nov 22 '14 at 23:20

As an academic researcher in Macro-Economics/Banking I'm afraid I have to disagree with Brythan. For me, saying questions about the structure of the monetary system are off topic for academic Economics, is a little like saying that details of the atomic structure are off topic for theoretical physics. If the implementation details of the banking system could be shown to not be systematically effecting, then a case could be made for that approach, but unfortunately it's quite the opposite. Not only do its implementation details affect the macro-economy, but they are also used in attempts to control the macro-economy. So an economic understanding of these obscure details is quite vital. It can also be quite fascinating at times - witness this paper on differences in clearing operations between London and New York in the 19th century.

Victorian Data Processing Martin Campbell-Kelly, Communications of the ACM 2010.

This question was nice, because somewhat tangentially it highlights something about the Federal Reserve that probably doesn't get enough consideration, which is that it operates as a distributed group of regional banks, rather than a single central bank. Besides raising some rather interesting book keeping questions (like this one), it also has some structural implications depending on how they organise themselves.


I think implementation stuff, and empirical observations, are crucial; because without them, theory is pointless.

For the private beta, I think the federal bank reserves question is a non-expert question, so inappropriate; but for the public beta, I think it would be fine.

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    $\begingroup$ Non-expert? Am I supposed to take that personally... :-) I am surprised at that assertion though, I'm not sure what area you work in, but it is these niggly details that I find are actually hard to find out easily. I would be surprised if anyone but an expert cared about the details. $\endgroup$ – Korone Nov 21 '14 at 15:56

I would find that question to be always off-topic, as there's no economic question at hand. Yes, the federal reserve system relates to central banking which has macroeconomic implications, but the question itself does not have any relation to macroeconomics. It's really a banking question.

Another way to look at this is that I don't think it makes any economic difference whether the federal reserve system has twelve separate ledgers or one overall ledger. Unless you can link it back to economic theory, it should be off-topic here.

All that said, I think that there are certainly implementation questions that matter. They involve the practical application of economic theory to the real world. Asking how to apply pricing theory to a real world product seems perfectly on-topic to me. I'm saying that your federal reserve situation is so far from the theory though as to not be of practical use on this site. Why does an economist or someone interested in economics need to know this?

Another way of looking at it is that the expert who would know the answer to this question would likely not be an economist, but a banker. Since we aren't trying to attract bankers unless they are economists, our experts would not be able to answer this question. Your real hope for an answer is that a comparatively amateur economist also happens to be a banker who knows this detail of how the federal reserve works. This makes that person a non-expert here while acknowledging that that person probably is an expert banker.

To look at your other examples, I would consider quantitative easing structure to be off-topic unless you were arguing that one structure was economically preferable over another. You might get more traction for this kind of question on Politics.SE.

Similarly, I would consider details of how X-12-ARIMA works to be off-topic unless you were arguing economic impact or the statistic is economic in nature. If your question is how you can find X-12-ARIMA now that it has been replaced with X-13ARIMA-SEATS, then that's off-topic.

Questions about how economic indicators are calculated should almost always be on-topic. These give people a chance to explain how the theory says that they should be calculated, to talk about how the practice differs, and why it matters (or doesn't).

In my opinion, questions that deal with the application of economic theory to the real world should be on-topic (but might be too broad or overly opinion-based). That's not a license to make anything that is tenuously related to economics a question though. Questions should link to the theory directly.

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    $\begingroup$ -1 but only because I disagree, excellent answer and thank you for answering. It sounds like you see this as an academic economics site. As a professional it is frequently these sorts of details that are hardest to answer. In this case I cannot do a diligent analysis of the US Central Bank balance sheet without a good understanding of the structure. You realise your definition effectively makes Carney and Yellen bankers not economists. But perhaps that is what will work best as a site. Good to start the debate. $\endgroup$ – Korone Nov 21 '14 at 18:46
  • $\begingroup$ @Corone I would consider Yellen an economist, as she has to deal with the question of whether to change interest rates. That's clearly an economic question to me. In fact, that's a clear case of an implementation detail that should be on-topic IMO. Now, Yellen might also be able to answer this question, but she's a member of a relatively small group of economists who would. $\endgroup$ – Brythan Nov 21 '14 at 19:12
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    $\begingroup$ She also has to decide what to do about quantitative easing. QE is the expansion of the CB balance sheet. You therefore can't understand QE without a proper understanding of the balance sheet. From a European view point, 12 balance sheets begs some questions. Sorry to break it to you but this kind of dull detail is the bread and butter of economics in the real world instead of the university. $\endgroup$ – Korone Nov 21 '14 at 19:21

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