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On the Non-Neutrality of Money: Evidence from the 1990s

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  • Petr Duczynski

Abstract

The paper examines the cross-country relations between nominal money and real output between 1990 and 2000. Both high money growth rates and declines in money are connected with below-average output growth rates. The association between the monetary base and real output is weaker than between M1 (or M2) and real output. I observe no tendency of money changes to precede output changes.

Suggested Citation

  • Petr Duczynski, 2004. "On the Non-Neutrality of Money: Evidence from the 1990s," Prague Economic Papers, Prague University of Economics and Business, vol. 2004(1), pages 40-54.
    • Handle: RePEc:prg:jnlpep:v:2004:y:2004:i:1:id:230:p:40-54
    DOI: 10.18267/j.pep.230
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    References listed on IDEAS

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    1. Christina D. Romer & David H. Romer, 1989. "Does Monetary Policy Matter? A New Test in the Spirit of Friedman and Schwartz," NBER Chapters, in: NBER Macroeconomics Annual 1989, Volume 4, pages 121-184, National Bureau of Economic Research, Inc.
    2. Barro, Robert J, 1978. "Unanticipated Money, Output, and the Price Level in the United States," Journal of Political Economy, University of Chicago Press, vol. 86(4), pages 549-580, August.
    3. Attfield, C. L. F. & Demery, D. & Duck, N. W., 1981. "A quarterly model of unanticipated monetary growth, output and the price level in the U.K. 1963-1978," Journal of Monetary Economics, Elsevier, vol. 8(3), pages 331-350.
    4. Kormendi, Roger C & Meguire, Philip G, 1984. "Cross-Regime Evidence of Macroeconomic Rationality," Journal of Political Economy, University of Chicago Press, vol. 92(5), pages 875-908, October.
    5. Wogin, Gillian, 1980. "Unemployment and monetary policy under rational expectations : Some Canadian evidence," Journal of Monetary Economics, Elsevier, vol. 6(1), pages 59-68, January.
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    Cited by:

    1. Petr Duczynski, 2005. "On the Empirics of the Non-neutrality of Money: Evidence from Developed Countries," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 55(5-6), pages 267-282, May.

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    More about this item

    Keywords

    consumer prices; M1; M2; monetary base; real output;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

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