An Update on Money in the Production Function
Using the Cobb-Douglas production function, this study tests whether money is a significant determinant of output. Three log-linear specifications are applied to U.S. annual data from 1959-85. Real output is expressed as a function of labor, capital, and real money balances. M1, M2, and M3 are tested in each of the three specifications. All three definitions of money are significant positive determinants of output in the unrestricted Cobb-Douglas. However, when the sum of the elasticities is restricted to one, the money coefficients become negative. This inconsistency needs to be further examined.
Volume (Year): 15 (1989)
Issue (Month): 3 (Jul-Sep)
|Contact details of provider:|| Postal: c/o Dr. Alexandre Olbrecht, The Anisfield School of Business 205, Ramapo College, 505 Ramapo Valley Road, Ramapo, New Jersey 07430, USA|
Phone: (201) 684-7346
Web page: https://www.quinnipiac.edu/eea/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Keith Christian Jensen & Shyam Kamath & Robert Bennett, 1987. "Money in the Production Function: An Alternative Test Procedure," Eastern Economic Journal, Eastern Economic Association, vol. 13(3), pages 259-269, Jul-Sep.
- Nguyen, Hong V, 1986. "Money in the Aggregate Production Function: Reexamination and Further Evidence," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 18(2), pages 141-151, May.
- Simos, Evangelos O., 1981. "Real money balances as a productive input : Further evidence," Journal of Monetary Economics, Elsevier, vol. 7(2), pages 207-225.
- Sinai, Allen & Stokes, Houston H, 1972. "Real Money Balances: An Omitted Variable from the Production Functions?," The Review of Economics and Statistics, MIT Press, vol. 54(3), pages 290-296, August.
- Subrahmanyam, Ganti, 1980. "Real Money Balances as a Factor of Production: Some New Evidence," The Review of Economics and Statistics, MIT Press, vol. 62(2), pages 280-283, May.
- Short, Eugenie Dudding, 1979. "A New Look at Real Money Balances as a Variable in the Production Function," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 11(3), pages 326-339, August.
When requesting a correction, please mention this item's handle: RePEc:eej:eeconj:v:15:y:1989:i:3:p:235-239. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Victor Matheson, College of the Holy Cross)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.