Abstract
Using two simple stochastic growth models that nest both exogenous and endogenous growth, this paper shows that money should not be neutral in the long run if it is not neutral in the short run and if growth is endogenous. By contrast, if growth is exogenous, money should be neutral in the long run. The paper also tests whether money is neutral in the long run, finding no contrary evidence. Given that money is not neutral in the short run, this finding indicates that exogenous growth cannot be rejected in favor of endogenous growth.
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© 1996 Physica-Verlag Heidelberg
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Evans, P. (1996). Growth and the Neutrality of Money. In: Durlauf, S., Helliwell, J.F., Raj, B. (eds) Long-Run Economic Growth. Studies in Empirical Economics. Physica-Verlag HD. https://doi.org/10.1007/978-3-642-61211-4_9
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DOI: https://doi.org/10.1007/978-3-642-61211-4_9
Publisher Name: Physica-Verlag HD
Print ISBN: 978-3-642-64747-5
Online ISBN: 978-3-642-61211-4
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