Tests of Equilibrium Macroeconomics Using Contemporaneous Monetary Data / John F. Boschen, Herschel I. Grossman.

Format:

Book

Author/Creator:

Boschen, John F.

Contributor:

National Bureau of Economic Research.

Grossman, Herschel I.

Series:

Working Paper Series (National Bureau of Economic Research) no. w0558.

NBER working paper series no. w0558

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1981.

Summary:

This paper uses contemporaneous monetary data to carry out econometric tests of the "equilibrium" approach to modeling the relation between monetary disturbances and macroeconomic fluctuations. The theoretical analysis introduces into an equilibrium macroeconomic model the availability of preliminary data on current monetary aggregates and the process of accumulation of revised monetary data. The econometric analysis tests two hypotheses derived from this extended model. One hypothesis concerns the neutrality of perceived monetary policy. The other hypothesis concerns the nonneutrality of errors in preliminary monetary data. The econometric results imply rejection of both of these hypotheses. These tests provide strong evidence against the reality of the equilibrium approach.

Notes:

Print version record

October 1981.