Money, inflation, and output under fiat and commodity standards
This study examines the behavior of money, inflation, and output under fiat and commodity standards to better understand how changes in monetary policy affect economic activity. Using long-term historical data for 15 countries, the study finds that the growth rates of various monetary aggregates are more highly correlated with inflation and with each other under fiat standards than under commodity standards. Money growth, inflation, and output growth are also higher under fiat standards. In contrast, the study does not find that money growth is more highly correlated with output growth under one type of standard than under the other. This study was originally published in the Journal of Political Economy (December 1997, vol. 105, no. 6, pp. 1308_21). It is reprinted in the Federal Reserve Bank of Minneapolis Quarterly Review with the permission of the University of Chicago Press.
Volume (Year): (1998)
Issue (Month): Spr ()
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References listed on IDEAS
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- Thomas J. Sargent, 1982.
"The Ends of Four Big Inflations,"
NBER Chapters,in: Inflation: Causes and Effects, pages 41-98
National Bureau of Economic Research, Inc.
- Thomas J. Sargent, 1981. "The ends of four big inflations," Working Papers 158, Federal Reserve Bank of Minneapolis.
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- Bordo Michael D. & Kydland Finn E., 1995. "The Gold Standard As a Rule: An Essay in Exploration," Explorations in Economic History, Elsevier, vol. 32(4), pages 423-464, October.
- George T. McCandless & Warren E. Weber, 1995. "Some monetary facts," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Sum, pages 2-11.
- Gerald P. Dwyer & R. W. Hafer, 1988. "Is money irrelevant?," Review, Federal Reserve Bank of St. Louis, issue May, pages 3-17.
- James Tobin, 1963. "Commercial Banks as Creators of 'Money'," Cowles Foundation Discussion Papers 159, Cowles Foundation for Research in Economics, Yale University. Full references (including those not matched with items on IDEAS)
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