Euro Area Money Demand: Measuring the Opportunity Costs Appropriately
The existence of a well-specified and stable relationship between money and prices has long been perceived as a prerequisite for the use of monetary aggregates in the conduct of monetary policy. This paper contributes to the ongoing discussion about the stability of euro area money demand by constru...
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Format: | Elektronisch E-Book |
Sprache: | English |
Veröffentlicht: |
Washington, D.C
International Monetary Fund
2001
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Schriftenreihe: | IMF Working Papers
Working Paper No. 01/179 |
Online-Zugang: | UBW01 UEI01 LCO01 SBR01 UER01 SBG01 UBG01 FAN01 UBT01 FKE01 UBY01 UBA01 FLA01 UBM01 UPA01 UBR01 FHA01 FNU01 BSB01 TUM01 Volltext |
Zusammenfassung: | The existence of a well-specified and stable relationship between money and prices has long been perceived as a prerequisite for the use of monetary aggregates in the conduct of monetary policy. This paper contributes to the ongoing discussion about the stability of euro area money demand by constructing an own rate of return on euro area M3 and by analyzing its implications in a standard money demand system. Over the sample period, one cointegrating vector relating real M3, real GDP and the spread between the short-term interest rate and the own rate of M3 can be identified and interpreted as a long-run euro area money demand equation. A dynamic money demand system is subsequently estimated. Standard diagnostics stability tests and out-of-sample forecasts confirm the good statistical performance of the model |
Beschreibung: | 1 Online-Ressource (38 p) |
ISBN: | 1451859031 9781451859034 |
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spelling | Levy, Joaquim Vieira Ferreira Verfasser aut Euro Area Money Demand Measuring the Opportunity Costs Appropriately Levy, Joaquim Vieira Ferreira Washington, D.C International Monetary Fund 2001 1 Online-Ressource (38 p) txt rdacontent c rdamedia cr rdacarrier IMF Working Papers Working Paper No. 01/179 The existence of a well-specified and stable relationship between money and prices has long been perceived as a prerequisite for the use of monetary aggregates in the conduct of monetary policy. This paper contributes to the ongoing discussion about the stability of euro area money demand by constructing an own rate of return on euro area M3 and by analyzing its implications in a standard money demand system. Over the sample period, one cointegrating vector relating real M3, real GDP and the spread between the short-term interest rate and the own rate of M3 can be identified and interpreted as a long-run euro area money demand equation. A dynamic money demand system is subsequently estimated. Standard diagnostics stability tests and out-of-sample forecasts confirm the good statistical performance of the model Online-Ausg Calza, Alessandro Sonstige oth Gerdesmeier, Dieter Sonstige oth http://elibrary.imf.org/view/IMF001/02116-9781451859034/02116-9781451859034/02116-9781451859034.xml Verlag URL des Erstveröffentlichers Volltext |
spellingShingle | Levy, Joaquim Vieira Ferreira Euro Area Money Demand Measuring the Opportunity Costs Appropriately |
title | Euro Area Money Demand Measuring the Opportunity Costs Appropriately |
title_auth | Euro Area Money Demand Measuring the Opportunity Costs Appropriately |
title_exact_search | Euro Area Money Demand Measuring the Opportunity Costs Appropriately |
title_exact_search_txtP | Euro Area Money Demand Measuring the Opportunity Costs Appropriately |
title_full | Euro Area Money Demand Measuring the Opportunity Costs Appropriately Levy, Joaquim Vieira Ferreira |
title_fullStr | Euro Area Money Demand Measuring the Opportunity Costs Appropriately Levy, Joaquim Vieira Ferreira |
title_full_unstemmed | Euro Area Money Demand Measuring the Opportunity Costs Appropriately Levy, Joaquim Vieira Ferreira |
title_short | Euro Area Money Demand |
title_sort | euro area money demand measuring the opportunity costs appropriately |
title_sub | Measuring the Opportunity Costs Appropriately |
url | http://elibrary.imf.org/view/IMF001/02116-9781451859034/02116-9781451859034/02116-9781451859034.xml |
work_keys_str_mv | AT levyjoaquimvieiraferreira euroareamoneydemandmeasuringtheopportunitycostsappropriately AT calzaalessandro euroareamoneydemandmeasuringtheopportunitycostsappropriately AT gerdesmeierdieter euroareamoneydemandmeasuringtheopportunitycostsappropriately |