The Review of Economics and Statistics Vol. 69 No. 3 1987
Money Demand: The Effects of Inflation and Alternative Adjustment Mechanisms
Abstract
The paper first reconciles a variety of specification tests for partial adjustment money demand models and points out a fundamental identification problem which makes it impossible to distinguish between the real and nominal partial adjustment models if inflation has an independent effect on the long-run demand for money. The paper also finds that empirical estimates of simple partial adjustment models have some undesirable properties and then considers the shortand long-run effects of inflation in a more general distributed lag model.
- DOI
- 10.2307/1925540
- Volume
- 69
- Issue
- 3
- Pages
- 511
- Sources
- crossref openalex