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Long Run Neutrality of Money in Mexico

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Author Info
Frederick H.Wallace () (Profesor-Investigador, Departamento de Ciencias Económico-Administrativas, Universidad de Quintana Roo, Chetumal, Quintana Roo, México.)
Gary L. Shelley () (Lecturer in Economics and Finance, Department of Economics, Finance, and Urban Studies, East Tennessee State University, Johnson City, Tennessee, USA)

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Abstract

The Fisher-Seater (FS) methodology is used to investigate long run money neutrality with respect to real GDP and real output in ten selected industries in Mexico. Size distortions and low power of the FS test, issues first raised by Coe and Nason (2003, 2004), are addressed using the Coe-Nason bootstrapping procedure. The evidence indicates that long run money neutrality can be rejected for real GDP and for up to five of the ten industrial sectors studied. These findings indicate that the effects of monetary policy are likely to differ across sectors even in the long run.

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File URL: http://www.economiamexicana.cide.edu/num_anteriores/XVI-2/02_WALLACE.pdf
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Publisher Info
Article provided by in its journal Economia Mexicana NUEVA EPOCA.

Volume (Year): XVI (2007)
Issue (Month): 2 (July-December)
Pages: 219-238
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:emc:ecomex:v:16:y:2007:i:2:p:219-238

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Related research
Keywords: money neutrality; Fisher-Seater Test; bootstrapping.;

Find related papers by JEL classification:
E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Coe, Patrick J. & Nason, James M., 2003. "The long-horizon regression approach to monetary neutrality: how should the evidence be interpreted?," Economics Letters, Elsevier, vol. 78(3), pages 351-356, March. [Downloadable!] (restricted)
  2. Stephen Williamson, 2004. "Search, Limited Participation, and Monetary Policy," 2004 Meeting Papers 214, Society for Economic Dynamics. [Downloadable!]
    Other versions:
  3. Obstfeld, Maurice & Rogoff, Kenneth, 1995. "Exchange Rate Dynamics Redux," CEPR Discussion Papers 1131, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  4. Olekalns, Nilss, 1996. "Some further evidence on the long-run neutrality of money," Economics Letters, Elsevier, vol. 50(3), pages 393-398, March. [Downloadable!] (restricted)
    Other versions:
  5. Garrett, Thomas A., 2003. "Aggregated versus disaggregated data in regression analysis: implications for inference," Economics Letters, Elsevier, vol. 81(1), pages 61-65, October. [Downloadable!] (restricted)
  6. Noriega, Antonio E., 2004. "Long-run monetary neutrality and the unit-root hypothesis: further international evidence," The North American Journal of Economics and Finance, Elsevier, vol. 15(2), pages 179-197, August. [Downloadable!] (restricted)
  7. Wallace, Frederick H. & Shelley, Gary L. & Cabrera Castellanos, Luis Fernando, 2004. "Pruebas de la neutralidad monetaria a largo plazo. El caso de Nicaragua," El Trimestre Económico, Fondo de Cultura Económica, vol. 0(283), pages 613-624, julio-sep.
  8. Wallace, Frederick H, 1999. "Long-Run Neutrality of Money in the Mexican Economy," Applied Economics Letters, Taylor and Francis Journals, vol. 6(10), pages 637-39, October. [Downloadable!] (restricted)
  9. Fisher, Mark E & Seater, John J, 1993. "Long-Run Neutrality and Superneutrality in an ARIMA Framework," American Economic Review, American Economic Association, vol. 83(3), pages 402-15, June. [Downloadable!] (restricted)
  10. Bae, Sang-Kun & Ratti, Ronald A., 2000. "Long-run neutrality, high inflation, and bank insolvencies in Argentina and Brazil," Journal of Monetary Economics, Elsevier, vol. 46(3), pages 581-604, December. [Downloadable!] (restricted)
  11. Haug, Alfred A & Lucas, Robert F, 1997. "Long-Run Neutrality and Superneutrality in an ARIMA Framework: Comment," American Economic Review, American Economic Association, vol. 87(4), pages 756-59, September. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Gary L. Shelley & Frederick H. Wallace, 2004. "Testing for Long Run Neutrality of Money in Mexico," Macroeconomics 0402003, EconWPA. [Downloadable!]
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This page was last updated on 2009-11-8.


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