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Testing the Validity of the Long Run Neutrality of Money in Nigeria

Author

Listed:
  • Ugwu Ephraim

    (Department of Economics, Federal University, Oye-Ekiti, Nigeria)

  • Ehinomen Christopher

    (Department of Economics, Federal University, Oye-Ekiti, Nigeria)

  • Nwosa Philip

    (Department of Economics, Federal University, Oye-Ekiti, Nigeria)

  • Efuntade Olubunmi

    (Department of Economics, Federal University, Oye-Ekiti, Nigeria)

Abstract

Research background: There is no consensus among scholars on the interaction effect between money supply, price, and wages despite various studies conducted to that effect.

Suggested Citation

  • Ugwu Ephraim & Ehinomen Christopher & Nwosa Philip & Efuntade Olubunmi, 2021. "Testing the Validity of the Long Run Neutrality of Money in Nigeria," Folia Oeconomica Stetinensia, Sciendo, vol. 21(2), pages 148-167, December.
    • Handle: RePEc:vrs:foeste:v:21:y:2021:i:2:p:148-167:n:6
    DOI: 10.2478/foli-2021-0021
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    References listed on IDEAS

    as
    1. Puah, Chin-Hong & Habibullah, M.S. & Abu Mansor, Shazali, 2008. "On the Long-Run Monetary Neutrality: Evidence from the SEACEN Countries," MPRA Paper 31762, University Library of Munich, Germany.
    2. Boschen, John F. & Grossman, Herschel I., 1982. "Tests of equilibrium macroeconomics using contemporaneous monetary data," Journal of Monetary Economics, Elsevier, vol. 10(3), pages 309-333.
    3. Lucas, Robert E, Jr, 1996. "Nobel Lecture: Monetary Neutrality," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 661-682, August.
    4. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    5. James B. Bullard, 1999. "Testing long-run monetary neutrality propositions: lessons from the recent research," Review, Federal Reserve Bank of St. Louis, vol. 81(Nov), pages 57-77.
    6. Kydland, Finn E & Prescott, Edward C, 1982. "Time to Build and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 50(6), pages 1345-1370, November.
    7. Robert J. Barro & Mark Rush, 1980. "Unanticipated Money and Economic Activity," NBER Chapters, in: Rational Expectations and Economic Policy, pages 23-73, National Bureau of Economic Research, Inc.
    8. Milton Friedman & Anna J. Schwartz, 1963. "A Monetary History of the United States, 1867–1960," NBER Books, National Bureau of Economic Research, Inc, number frie63-1, March.
    9. Emmanuel Anoruo, 2005. "Testing Neutrality of Money for Nigeria: A Nonparametric Cointegration Approach," The IUP Journal of Monetary Economics, IUP Publications, vol. 0(4), pages 16-25, November.
    10. George B. Tawadros, 2007. "Testing the hypothesis of long‐run money neutrality in the Middle East," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 34(1), pages 13-28, January.
    11. Naved Ahmad & Fareed Ahmed, 2006. "The Long-run and Short-run Endogeneity of Money Supply in Pakistan: An Empirical Investigation," SBP Research Bulletin, State Bank of Pakistan, Research Department, vol. 2, pages 267-278..
    12. A. W. Phillips, 1958. "The Relation Between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861–1957," Economica, London School of Economics and Political Science, vol. 25(100), pages 283-299, November.
    13. Stanley Fischer, 1980. "Rational Expectations and Economic Policy," NBER Books, National Bureau of Economic Research, Inc, number fisc80-1, March.
    14. Nayan, Sabri & Ahmad, Mahyudin & Kadir, Norsiah & Abdullah, Mat Saad, 2013. "Post Keynesian Endogeneity of Money Supply: Panel Evidence," MPRA Paper 48716, University Library of Munich, Germany.
    15. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
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    More about this item

    Keywords

    Money neutrality; money supply; Phillips Curve; Fisher effect; cointegration; VECM;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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