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International currency substitution and the apparent instability of velocity in some western European economies and in the United States


  • Bruce Brittain

    (Lyster Watson & Company - Institutional Advisory Group)


The purpose of this paper is to describe and interpret some empirical regularities in the movements of money's income velocity of circulation in major industrial countries. The results offer support for the "portfolio view", especially in the case of Germany. Since 1976, increases in the opportunity cost and the risk associated with holding dollars have argued strongly in favour of a shift in currency demand towards the Deutsche Mark.

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  • Bruce Brittain, 1980. "International currency substitution and the apparent instability of velocity in some western European economies and in the United States," BIS Working Papers 2, Bank for International Settlements.
  • Handle: RePEc:bis:biswps:2

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    References listed on IDEAS

    1. Jared Enzler & Lewis Johnson & John Paulus, 1976. "Some Problems of Money Demand," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(1), pages 261-282.
    2. Pentti J.K. Kouri & Jorge B. de Macedo, 1978. "Exchange Rates and the International Adjustment Process," Cowles Foundation Discussion Papers 488, Cowles Foundation for Research in Economics, Yale University.
    3. Hamburger, Michael J., 1977. "Behavior of the money stock : Is there a puzzle?," Journal of Monetary Economics, Elsevier, vol. 3(3), pages 265-288, July.
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