Testing the Lucas critique for the Turkish money demand function

Metin Yıldırım and Levent Korap ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper aims to test the prevalence of the Lucas critique by use of an applied modelling approach. The Turkish narrow money demand is chosen for investigation purposes and an extensive statistical-based econometric application has been carried out to observe whether the model in question has been exposed to the content of such a critique. The results confirm the theory to explain the behavioral foundations of aggregate monetary economics approaches and reveal that no evidence can be found in favor of the non-rejection of the Lucas critique that leads us to infer that the modelling attempt can be considered by the researcher a feedback model which is able to encompass a whole class of expectation models.

Keywords: Money Demand; Lucas Critique; Turkish Economy (search for similar items in EconPapers)
JEL-codes: C32 E41 E61 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-ara and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in İktisat, İşletme ve Finans 27.318(2012): pp. 57-82

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Journal Article: Testing the Lucas Critique for the Turkish Money Demand Function (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:41156

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