Non-Linear Equilibrium Corection in US Real Money Balances, 1869-1997

David A. Peel, Lucio Sarno () and Mark P. Taylor ()

No 3249, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Several theoretical models of money demand imply non-linear functional forms for the aggregate demand for money characterized by smooth adjustment towards long-run equilibrium. In this Paper, we propose a non-linear equilibrium correction model of US money demand, which is shown to be stable over the sample period from 1869 to 1997.

Keywords: adjustment costs; demand for money; equilibrium correction; non-linear dynamics (search for similar items in EconPapers)
JEL-codes: E41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac
Date: Written 2002-03

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Related works:
Journal Article: Nonlinear Equilibrium Correction in U.S. Real Money Balances, 1869-1997 (2003)
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