Is Money Really Exogenous? Testing for Weak Exogeneity in Swiss Money Demand

Andreas Fischer ()

Journal of Money, Credit and Banking, 1993, vol. 25, issue 2, 248-58

Abstract: Although exogeneity is often associated with controllable policy variables, Engle, Hendry, and Richard (1983) show that the one condition is neither necessary nor sufficient for the other. Whether variables such as monetary aggregates are (weakly) exogenous depends on the conditioning properties of the data generating process. Testing exogeneity claims represents an important step in analyzing money demand functions. Although Switzerland adheres to fairly strict monetarist prescriptions, we reject the hypothesis that M0 and M1 are weakly exogenous for a price equation. Our results for M1 support the conventional view in which money market equations reflect the demand for money as the dependent variable. Copyright 1993 by Ohio State University Press.

Date: 1993
References: Add references at CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
http://links.jstor.org/sici?sici=0022-2879%2819930 ... 0.CO%3B2-O&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mcb:jmoncb:v:25:y:1993:i:2:p:248-58

Access Statistics for this article

Journal of Money, Credit and Banking is currently edited by Robert deYoung, Paul Evans, Pok-Sang Lam and Kenneth D. West

More articles in Journal of Money, Credit and Banking from Blackwell Publishing
Bibliographic data for series maintained by Wiley-Blackwell Digital Licensing () and Christopher F. Baum ().