Some Qualms about the Test of the Institutional Hypothesis of the Long-run Behavior of Velocity
AbstractThis paper expresses econometric qualms about M. D. Bordo and L. Jonung's (1981) analysis of long-run volocity. They did not recognize that, for U.S. and Canadian data, the log of velocity has a unit root. Hence, estimation of a log-level regression may produce spurious regressions. When Bordo and Jonung's volocity equation is reestimated in rate-of-change form, permanent income is significant, contrary to their earlier conclusion. Moreover, using this approach gives a stronger result for one of the institutional variables in the velocity function, in the sense that the remaining variables become more significant. Copyright 1988 by Oxford University Press.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by Western Economic Association International in its journal Economic Inquiry.
Volume (Year): 26 (1988)
Issue (Month): 3 (July)
Contact details of provider:
Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Fax: 01865 267 985
Web page: http://ei.oupjournals.org/
More information through EDIRC
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Peter N. Ireland, 1991. "Financial evolution and the long-run behavior of velocity : new evidence from U.S. regional data," Economic Review, Federal Reserve Bank of Richmond, issue Nov, pages 16-26.
- Michael D. Bordo & Lars Jonung & Pierre Siklos, 1993. "The Common Development of Institutional Change as Measured by Income Velocity: A Century of Evidence from Industrialized Countries," NBER Working Papers 4379, National Bureau of Economic Research, Inc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.