Money Demand in Ireland, 1933-2012

Stefan Gerlach (hms.gerlach@gmail.com) and Rebecca Stuart

No 9962, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Using annual data from several sources, we study the evolution of M1, M2, income, prices and long and short interest rates in Ireland over the period 1933-2012. We find cointegration and that prices, income and interest rates are weakly exogenous. While the estimates for M2 are stable and close to our priors, for M1 we obtain very low price elasticities, and a relatively high income elasticity, and detect parameter instability. We estimate a short-run M2 demand function that passes a number of diagnostic tests, although the standard errors of the regressions is large.

Keywords: Historical statistics; Income; Ireland; Long time series; Money; Prices (search for similar items in EconPapers)
JEL-codes: E3 E4 N14 (search for similar items in EconPapers)
Date: 2014-05
New Economics Papers: this item is included in nep-his, nep-mac and nep-mon
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Working Paper: Money demand in Ireland, 1933-2012 (2014)
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