Money's Role in the Monetary Business Cycle

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Money's Role in the Monetary Business Cycle

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Ireland, Peter N

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Peter N. Ireland

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 these considerations into account, but still suggest that money plays a minimal role in the monetary business cycle.

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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Money, Credit and Banking.

Volume (Year): 36 (2004)
Issue (Month): 6 (December)
Pages: 969-83
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Handle: RePEc:mcb:jmoncb:v:36:y:2004:i:6:p:969-83

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Paper
- Peter N. Ireland, 2001. "Money's Role in the Monetary Business Cycle," NBER Working Papers 8115, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
- Peter N. Ireland, 2000. "Money's Role in the Monetary Business Cycle," Boston College Working Papers in Economics 458, Boston College Department of Economics. [Downloadable!]

References listed on IDEAS
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Other versions:
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Other versions:
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Other versions:
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