1)Why do central banks use open market operations as opposed to (for instance) direct wage subsidies?

2)Where does the money come from, that the Federal Reserve uses to buy bonds for its open market operations?

1)The central bank use open market operations as opposed to direct wage subsidies because of the price stability is the other objective of Federal Reserve and if money is injected into the economy then it will increase the money supply such that the aggregate demand curve shifts rightward which increases both price level and output in an economy and it will hard for the Federal Reserve to prevent rise in the price level in an economy which is the objective of Federal Reserve. Another reason is that employment is not only the objective of the federal reserve such that another objective is to keep interest rate low to finance the deficit spending.

2)In US monetary policy, open market purchases are a tool used by the Federal Reserve to increase the money supply in order to ultimately decrease interest rates and stimulate economic growth. The way that the Federal Reserve is able to increase the money supply when it conducts these open market purchases is by creating new money. This is the primary way in which new money is created in the US economy. In other words, the money that the Federal Reserve uses to fund open market purchases did not come from anywhere - it did not exist at all before the purchase, but that is precisely the point of the whole concept.