Another Look at Long-Run Money Demand

Laurence Ball

No 6597, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper investigates the long-run demand for M1 in the postwar United States. Previous studies, based on data ending in the late 1980's, are inconclusive about the parameters of postwar money demand. This paper obtains precise estimates of these parameters by extending the data through 1996. The income elasticity of money demand is approximately 0.5, and the interest semi-elasticity is approximately -0.05. These parameters are significantly smaller in absolute value than the corresponding parameters for the prewar period.

JEL-codes: E41 (search for similar items in EconPapers)
Date: 1998-06
Note: EFG ME
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Citations: View citations in EconPapers (13)

Published as Ball, Laurence. "Another Look At The Long-Run Money Demand," Journal of Monetary Economics, 2001, v47(1,Feb), 31-44.

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