The demand for money in Austria
Bernd Hayo ()
No B 06-2000, ZEI Working Papers from ZEI - Center for European Integration Studies, University of Bonn
In this paper, the demand for real money M1, M2, and M3 is estimated for Austria. The modelling takes place within the framework of a small vector autoregression. To estimate the demand for money, two-equation error-correction models are constructed, which contain the short-run dynamics and the long-run economic equilibrium. It is found that a stable money demand exists for all monetary aggregates. The long-run equilibrium of M1, after accounting for a structural break in 1979, can be characterised as a classical type of money demand, with no interest rate effects and a unity elasticity of real GDP. In the case of M2 and M3, we find a unit coefficient on income and a significantly negative influence of a long-term interest rate. The statistical properties of the estimated short-run money demand equations – considering insample and out-of-sample (35 observations) tests – are generally very good.
Keywords: monetary economics; money demand; Austria (search for similar items in EconPapers)
JEL-codes: E41 C32 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Journal Article: The demand for money in Austria (2000)
Working Paper: The Demand For Money In Austria (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:zbw:zeiwps:b062000
Access Statistics for this paper
More papers in ZEI Working Papers from ZEI - Center for European Integration Studies, University of Bonn Contact information at EDIRC.
Series data maintained by ZBW - German National Library of Economics ().