Money's Role in the Monetary Business Cycle

Peter Ireland

No 8115, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: A small, structural model of the monetary business cycle implies that real money balances enter into a correctly-specified, forward-looking IS curve if and only if they enter into a correctly-specified, forward-looking Phillips curve. The model also implies that empirical measures of real balances must be adjusted for shifts in money demand to accurately isolate and quantify the dynamic effects of money on output and inflation. Maximum likelihood estimates of the model's parameters take both of these considerations into account, but still suggest that money plays a minimal role in the monetary business cycle.

JEL-codes: E31 E32 (search for similar items in EconPapers)
Date: 2001-02
New Economics Papers: this item is included in nep-mon
Note: ME
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Citations: View citations in EconPapers (53)

Published as Ireland, Peter N. "Money's Role In The Monetary Business Cycle," "Journal of Money, Credit and Banking, 2004, v36(6,Dec), 969-983.

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Journal Article: Money's Role in the Monetary Business Cycle (2004)
Software Item: Matlab code for Money's Role in the Monetary Business Cycle (2000)
Working Paper: Money's Role in the Monetary Business Cycle (2000)
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