The stability of German money demand: Not just a myth

Michael Scharnagl ()
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Michael Scharnagl: Deutsche Bundesbank, Wilhelm-Epstein-Str. 14, D-60431 Frankfurt/Main, Germany

Empirical Economics, 1998, vol. 23, issue 3, 355-370

Abstract: The stability of German money demand has been analyzed in a series of papers in recent years, especially since unification. In this paper the critical question of stability is reviewed, using various estimation techniques and testing procedures for long-run stability. To take financial innovations into account, the opportunity cost measure is calculated by differentiating between traditional savings deposits and special savings facilities, which are a major form of financial innovation in Germany. Overall, there are strong indications of a stable long-run money-demand relationship.

Keywords: Money; demand; ·; stability; tests; ·; financial; innovations (search for similar items in EconPapers)
JEL-codes: C22 C51 C52 (search for similar items in EconPapers)
Date: 1998-09-01
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Citations: View citations in EconPapers (20)

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