1. Stability of the U.S. Short-Run Money Demand Function, 1959-81.
- Author
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LIN, KUAN-PIN and OH, JOHN S.
- Subjects
DEMAND for money ,DEMAND function ,MONEY supply ,FINANCIAL crises ,ECONOMIC demand ,SHIFT-share analysis ,UNITED States economy, 1971-1981 ,STATISTICAL hypothesis testing ,REGRESSION analysis ,MATHEMATICAL models of economics ,ECONOMIC equilibrium - Abstract
Stability tests are performed for the conventional U.S. money demand equation using switch regression techniques. This methodology provides for the identification of the shift point and the type of shift (abrupt or drift), and is conducive to hypothesis testing to determine the sources of the shift for the regression equation. Our findings do not support the contention that the 1974 change in money demand equation is a downward shift in the constant term, as suggested by many recent empirical money demand studies. [ABSTRACT FROM AUTHOR]
- Published
- 1984
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