The Fisher Effect: A Review of the Literature
AbstractThe Fisher hypothesis has been a much debated topic. Over the years the hypothesis debated and the techniques used have changed. While the majority of early studies on the Fisher effect concentrated primarily on confirming the long and distributed lag in expectations formation, subsequent work saw the integration of the Fisher hypothesis with the theories of rational expectations and efficient markets. With the incorporation of these theories in the Fisher hypothesis, the methodological advances involved examining the time series properties of the variables in question. This survey reviews previous work from this perspective. In addition, the studies pertaining to developing economies and possible explanations for the failure of the Fisher effect are also reviewed.
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Bibliographic InfoPaper provided by Macquarie University, Department of Economics in its series Research Papers with number 0206.
Length: 25 pages.
Date of creation: Sep 2002
Date of revision:
Fisher Effect; adaptive expectations; rational expectations;
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UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers)
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