Portfolio and Consumption Decisions: Towards a Model of the Transmission Process
This paper argues that a key difference between the monetarists and the neo-Keynesians is their respective views about how monetary policy works. Both views are shown to be special cases of the integrated model developed. The model is presented in such a form that it is a relatively straightforward empirical exercise to test for the relative merits of the two special cases. Preliminary evidence for Australia is presented.
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