The demand for money in the United States— Yet again

Laidler, David

doi:10.1016/0167-2231(80)90029-9

Cited by 83 publications

(31 citation statements)

References 37 publications

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“…A second test of coefficients stability is the predictive-power procedure popularized by Goldfeld (1973) and used by many other researchers (e.g. Boughton, 1979 andLaidler, 1980). Although both tests are applied in this study, it should be noted that they suffer from serious handicaps.…”

Section: Description Of the Stability Testsmentioning

confidence: 98%

“…Laidler (1980) has argued that a fully consistent money demand estimation may require simultaneous estimations of supply and demand equations. However, as Boughton (1981) pointed out, such an argument is solely 9A constant term is included in the equation to ascertain whether or not a time trend is present in the postulated demand relationship.…”

Section: T H E M O N E Y D E M a N D M O D E L A N D T H E E M P I R mentioning

confidence: 99%

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The demand for money in some major OPEC members: regression estimates and stability results

Darrat

1986

Applied Economics

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Section: Description Of the Stability Testsmentioning

confidence: 98%

Section: T H E M O N E Y D E M a N D M O D E L A N D T H E E M P I R mentioning

confidence: 99%

The demand for money in some major OPEC members: regression estimates and stability results

Darrat

1986

Applied Economics

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“…Rather, the error term of this relationship is misinterpreted to reflect solely disturbances in money demand while actually it is strongly associated with changes in the supply of money. 12) For additional discussion on buffer stock money, the reader can consult Laidler [1983] and Goodhart [19821. …”

Section: Concluding Commentsmentioning

confidence: 99%

The role of capital flows in the adjustment of money demand: The case of Finland

Kanniainen

Tarkka

1984

Empirical Economics

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The paper models the dual role of money balances as a short-run buffet stock and an asset with a weU-speeified long-run demand function. The analysis is carried out in an open economy framework. Consequently, there will be an offset to monetary policy in the form of induced capital movements, but in our model, it will be distributed over time even under perfect substitutability of financial claims. Estimates for the parameters of the demand for money function axe obtained from a capital flow equation using both unrestricted (OLS) and restricted (nonlinear) estimation methods, The results provide strong evidence in favour of the shock-absorption theory for the adjustment of money demand under money supply changes.

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“…Intuitively, the omission of short-run supply behaviour creates few difficulties in estimating the long-run money demand function, as both the demand for and the supply of money are thought to be in equilibrium.4 These arguments owe much to buffer-stock models(Laidler, 1980(Laidler, , 1982(Laidler, , 1984Mizen, 1994). In particular, the introduction of a representation of the behaviour of money supply addressesLaidler's (1980) point that the 'buffer-stock'-type model, '.…”

mentioning

confidence: 97%

“…In particular, the introduction of a representation of the behaviour of money supply addressesLaidler's (1980) point that the 'buffer-stock'-type model, '. .…”

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confidence: 99%

Monetary dynamics: a market approach

Schmidt

2003

Applied Economics

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The behaviour of the short-run responses implied by the identification of a long-run money demand relationship is examined. These responses have recently been interpreted as representing the policy stance of the monetary authority. However, as movements in the monetary aggregate reflect both demand and supply adjustments, estimating the short-run dynamics solely within the money demand relationship may produce biased results. In order to address this issue, the paper explicitly acknowledges the importance of the supply of money function by including the function alongside the demand for money function. While the interaction of the two equations continues to produce the long-run quantity theory result, the additional detail provides more accurate estimates of the individual short-run adjustments within the two equations.

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The demand for money in the United States— Yet again

Cited by 83 publications

References 37 publications

The demand for money in some major OPEC members: regression estimates and stability results

The demand for money in some major OPEC members: regression estimates and stability results

The role of capital flows in the adjustment of money demand: The case of Finland

Monetary dynamics: a market approach

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