IS THE CONVENTIONAL VIEW OF DISCOUNT WINDOW BORROWING CONSISTENT WITHTHE BEHAVIOR OF WEEKLY REPORTING BANKS

Discount window borrowing by weekly reporting banks disaggregated by F ederal Reserve District is used to estimate Goodfriend's model of borr owed reserves. Little evidence is found to support the argument that a bank's borrowing decision is determined by the spread between the fun ds rate and the discount rate and by prior bank borrowing. A weekly re porting bank has only a 2.7% chance of visiting the discount window du ring any given maintenance period. This result is consistent with the presence of considerable harassment costs imposed by the discount wind ow officer.