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Money, Inflation and Growth in Germany. A Vector-Error-Correction-P-Star Model / Der Zusammenhang zwischen Geldmenge, Output und Preisen in Deutschland. Ein Vektorfehlerkorrektur-P-Star-Ansatz

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  • Clostermann Jörg

    (University of Applied Sciences Ingolstadt, P.O.B. 210454, D-85049 Ingolstadt. Tel.: ++49/+8 41/93 48-1 22/-1 27, Fax: ++49/+8 41/93 48-9 9122)

  • Seitz Franz

    (University of Applied Sciences Amberg-Weiden, Hetzenrichter Weg 15, D-92637 Weiden. Tel.: ++491+9 61/3 82-1 72, Fax. ++49/+9 61/3 82-1 10)

Abstract

The present paper uses the P-Star approach to analyze the real and price effects of German monetary policy on the basis of a multivariate vector-error-correction-model. One surprising result is that the Bundesbank does not cause the price effects of its monetary policy actions directly via (rational) expectations but only indirectly via influencing the output gap. The real effects of monetary policy are only of a temporary nature. In the long run money is neutral.

Suggested Citation

  • Clostermann Jörg & Seitz Franz, 2002. "Money, Inflation and Growth in Germany. A Vector-Error-Correction-P-Star Model / Der Zusammenhang zwischen Geldmenge, Output und Preisen in Deutschland. Ein Vektorfehlerkorrektur-P-Star-Ansatz," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 222(6), pages 641-655, December.
    • Handle: RePEc:jns:jbstat:v:222:y:2002:i:6:p:641-655
    DOI: 10.1515/jbnst-2002-0602
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    References listed on IDEAS

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    Cited by:

    1. Czudaj, Robert, 2011. "P-star in times of crisis - Forecasting inflation for the euro area," Economic Systems, Elsevier, vol. 35(3), pages 390-407, September.

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