European integration and the demand for broad money
AbstractCo-integration analysis and error-correction modelling show that a stable and predictable aggregate demand for broad money holds for the group of countries participating in the Exchange Rate Mechanism (ERM) of the European Monetary System. This result seems robust to different econometric techniques, samples and methods of conversion of national variables into ecus. Furthermore, ERM-wide equations compare favourably with national equations and with the previous estimates of area-wide equations for narrow money. These findings suggest that an area-wide broad monetary aggregate can play a useful role in the co-ordination of monetary policy at the European level.
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Bibliographic InfoPaper provided by Bank for International Settlements in its series BIS Working Papers with number 18.
Length: 38 pages
Date of creation: Apr 1992
Date of revision:
Other versions of this item:
- Monticelli, Carlo & Strauss-Kahn, Marc-Olivier, 1993. "European Integration and the Demand for Broad Money," The Manchester School of Economic & Social Studies, University of Manchester, vol. 61(4), pages 345-66, December.
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