Hasan, Mohammad S (2010) Modeling the Dynamics of Money Income from a Vector Correction Model. Journal of Developing Areas, 43 (2). pp. 233-253. ISSN 0022-037X . (doi:10.1353/jda.0.0067) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided)
The purpose of this paper is to re-examine the empirical relationship among alternative monetary aggregates (M1 and M2), output, prices, interest rates and exchange rates in India. The results of a five-variate vector error correction model are indicative of a bi-directional causality between each of the monetary aggregates and prices. Our findings of a feedback relationship make each of the monetary aggregates a poor intermediate target and informational variable. Moreover, contrary to most recent research in this area, the results are supportive of the real business-cycle view and the Keynesian monetary accommodation hypothesis rather than the monetarists’ theory of the business cycle.
|Subjects:||H Social Sciences|
|Divisions:||Faculties > Social Sciences > Kent Business School > Accounting and Finance|
|Depositing User:||Mohammad Hasan|
|Date Deposited:||06 Jan 2010 11:09|
|Last Modified:||10 Feb 2016 16:24|
|Resource URI:||https://kar.kent.ac.uk/id/eprint/23564 (The current URI for this page, for reference purposes)|