Instability of the Velocity of Money: A New Approach Based on the Evolutionary Spectrum
Money demand instability has been the subject of considerable attention in the recent literature. This paper examines the stability of velocity series for the United States and for five European countries (France, Germany, Italy, the Netherlands and the United Kingdom). A distribution-free test due to Subba Rao (1981) and based on the concept of the evolutionary spectrum is used. The test does not require the assumption that distributions are Gaussian and is able to decompose (by frequency) the sources of instability. The technique reveals structural breaks of long-term significance for only broad money velocity in the United States and narrow money velocity in the United Kingdom.
|Date of creation:||Nov 1992|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
|Order Information:|| Email: |
When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:735. 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: ()
If references are entirely missing, you can add them using this form.