Money and Business Cycles: A Real Business Cycle Interpretation / Charles I. Plosser.

Format:

Book

Author/Creator:

Plosser, Charles I.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w3221.

NBER working paper series no. w3221

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Money and Business Cycles

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1990.

Summary:

This paper focuses on the role of money in economic fluctuations. While money may play an important role in market economies, its role as an important impulse to business cycles remains a highly controversial hypothesis. For years economists have attempted to construct monetary theories of the business cycle with only limited empirical success. Alternatively, recent real theories of the cycle have taken the view that to a first approximation independent variations in the nominal quantity of outside money are neutral. This paper finds that the empirical evidence for a monetary theory of the cycle is weak. Not only do variations in nominal money explain very little of subsequent movements in real activity, but what explanatory power exists arises from variations in endogenous components of money.

Notes:

Print version record

January 1990.