Money, Inflation, and Economic Growth: Some Updated Reduced Form Results and Their Implications
Year: 1980
Type: article
Abstract: HE economic experience of the United States during the 1950s and 1960s provided an opportunity to develop and test a number of hypotheses relating to the performance of the macroeconomy.One such hypothesis that received empirical support during this period held that monetary actions, as measured by movements in the monetary aggregates, have lasting effects on only nominal variables.This proposition is an important element in a body of thought called "tri,,'In contrast to the relative economic tranquility of the l950s and 196Os, the decade of the 1970s was marked by' extensive experimentation with wage and price controls, large supply shocks, proliferation of government regulations, and worldwide inflation.These events and developments prompted economists to question whether or not the performance of the United States economy during this period was consistent with prior hypotheses relating to the lasting impact of monetary actions.This article is addressed to that question.The article focuses on the magnitude of the response of GNP, output, and the price level to changes in the money stock, defined as currency plus private 1 For an extensive discussion of monetarism, see Thomas Mayer, et.al., The Structure of Monetarisnr (New York: W. W. Norton and Company, 1978).checkable deposits.2 The magnitudes of these responses
Author: Keith M. Carlson
Language: English
Domain: Social Sciences
Open Access status: gold
OpenAlex ID: W2170836582