Skip to main content
SpringerLink
Log in

Money or Output Gap: What Matters for Inflation in the Euro Area?

  • Chapter
Essener Beiträge zur empirischen Wirtschaftsforschung

  • 1452 Accesses

Abstract

Central banks such as the Swiss national Bank, the Bundesbank, the Bank of Canada, the Bank of England and the Federal Reserve started to use monetary aggregates as an intermediate target of their monetary policy strategy in the 70s. Since the start of stage three of European Economic and Monetary Union (EMU) in 1999, the stock of money plays a crucial role within the ECB’s monetary policy strategy as well.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 69.99
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 89.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Literatur

  • Assenmacher, W. (1998): Trends and Cycles in the Gross Domestic Product of the Federal Republic of Germany, in: Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Jg. 217, Nr. 5, S. 628–649.

    Google Scholar 

  • Basco, E., D’Amato, L., Garegnani, L. (2009): Understanding the Money-Prices Relationship Under Low and High Inflation Regimes: Argentina 1977–2006, in: Journal of International Money and Finance, Jg. 28, Nr. 7, S. 1182–1203.

    Article  Google Scholar 

  • Belke, A., Czudaj, R. (2010): Is Euro Area Money Demand (Still) Stable? Cointegrated VAR Versus Single Equation Techniques, in: Applied Economics Quarterly – Konjunkturpolitik, Jg. 56, Nr. 4, S. 285–315.

    Article  Google Scholar 

  • Brand, C., Gerdesmeier, D., Roffia, B. (2002): Estimating the Trend of M3 Income Velocity Underlying the Reference Value for Monetary Growth, in: European Central Bank – Occasional Paper Series, Nr.3.

    Google Scholar 

  • Clark, T.-E., West, K.-D. (2007): Approximately Normal Tests for Equal Predictive Accuracy in Nested Models, in: Journal of Econometrics, Jg. 138, Nr. 1, S. 291- 311.

    Article  Google Scholar 

  • Clostermann, J., Seitz, F. (2002): Money, Inflation and Growth in Germany: A Vector-Error-Correction- P-Star Model, in: Journal of Economics and Statistics, Jg. 222, Nr. 6, 641–655.

    Google Scholar 

  • Czudaj, R. (2011): P-Star in Times of Crisis – Forecasting Inflation for the Euro Area, in: Economic Systems, Jg. 35, Nr. 3, S. 390–407.

    Article  Google Scholar 

  • Czudaj, R. (2012): Modelling Euro Area Money Demand and Forecasting Inflation in a Time-Varying Environment, in: International Journal of Monetary Economics and Finance, forthcoming.

    Google Scholar 

  • De Grauwe, P., Polan, M. (2005): Is Inflation Always and Everywhere a Monetary Phenomenon?, in: The Scandinavian Journal of Economics, Jg. 107, Nr. 2, S. 239–259.

    Article  Google Scholar 

  • Dickey, D.-A., Fuller, W.-A. (1979): Distribution of the Estimators for Autoregressive Time Series with a Unit Root, in: Journal of the American Statistical Association, Jg. 74, Nr. 366, 427–431.

    Article  Google Scholar 

  • Dickey, D.-A., Fuller, W.-A. (1979): (1981): Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root, in: Econometrica, Jg. 49, Nr. 4, S. 1057–1072.

    Article  Google Scholar 

  • Dolado, J.-J., Jenkinson, T., Sosvilla-Rivero, S. (1990): Cointegration and Unit Roots, in: Journal of Economic Surveys, Jg. 4, Nr 3, S. 249–273.

    Article  Google Scholar 

  • Dreger, C., Wolters, J. (2010): Money Demand and the Role of Monetary Indicators in Forecasting Euro Area Inflation, DIW Berlin, German Institute for Economic Research, Discussion Paper Series, Nr. 1064.

    Google Scholar 

  • Dwyer, G. P., Fisher, M. (2009): Inflation and Monetary Regimes, in: Journal of International Money and Finance, Jg. 28, Nr. 7, S. 1221–1241.

    Article  Google Scholar 

  • ECB (2000): Potential Output Growth and Output Gaps: Concept, Uses and Estimates, Monthly Bulletin, October, 37–47.

    Google Scholar 

  • ECB (2003): The Outcome of the ECB’s Evaluation of its Monetary Policy Strategy, Monthly Bulletin, June, S. 79–92.

    Google Scholar 

  • ECB (2004): "The Monetary Policy of the ECB," European Central Bank, Frankfurt am Main.

    Google Scholar 

  • ECB (2009): "Potential Output Estimates for the Euro Area," Monthly Bulletin, July, S. 44–48.

    Google Scholar 

  • ECB (2011): "Trends in Potential Output," MonthlyBulletin, January, S. 73–85.

    Google Scholar 

  • Elliott, G., Rothenberg, T.-J., Stock, J.-H (1996): Efficient Tests for an Autoregressive Unit Root, in: Econometrica, Jg. 64, Nr. 4, S. 813–836.

    Google Scholar 

  • Enders, W. (2010): Applied Econometric Time Series, 3rd Edition, Hoboken, NJ

    Google Scholar 

  • Enders, W., Granger, C.-W.-J. (1998): Unit-Root Tests and Asymmetric Adjustment with an Example Using the Term Structure of Interest Rates, in: Journal of Business and Economic Statistics, Jg. 16, Nr. 3, S. 304–311.

    Article  Google Scholar 

  • Enders, W., Siklos, P. L (2001): Cointegration and Threshold Adjustment, in: Journal of Business and Economic Statistics, Jg. 19, Nr. 2, S. 166–176.

    Article  Google Scholar 

  • Engle, R.-F., Granger, C.-W.-J. (1987): Cointegration and Error Correction: Representation, Estimation, and Testing, in: Econometrica, Jg. 55, Nr. 2, S. 251–276.

    Article  Google Scholar 

  • Friedman, M. (1956): The Quantity Theory of Money – A Restatement, in: Studies in the Quantity Theory of Money, ed. by M. Friedman, Chicago: Chicago University Press, S. 3–21.

    Google Scholar 

  • Gerlach, S., Svensson, L.-E.-O (2003): Money and Inflation in the Euro Area: A Case for Monetary Indicators?, in: Journal of Monetary Economics, Jg. 50, Nr. 8, S. 1649–1672.

    Article  Google Scholar 

  • Gibbs, D. (1995): Potential Output: Concepts and Measurement, Labour Market Bulletin, 1, S. 72–115.

    Google Scholar 

  • Hall, S.-G., Hondroyiannis, G, Swamy, P.-A.-V.-B, Tavlas, G.-S (2009): Assessing the Causal Relation- ship Between Euro-Area Money and Prices in a Time-Varying Environment, in: Economic Modelling, Jg. 26, Nr. 4, S. 760–766.

    Article  Google Scholar 

  • Hallman, J.-J., Porter, R.-D., Small, D. H (1991): Is the Price Level Tied to the M2 Monetary Aggregate in the Long Run?, in: American Economic Review, Jg. 81, Nr. 4, S. 841–858.

    Google Scholar 

  • Hofmann, B. (2009): Do Monetary Indicators Lead Euro Area Inflation?, in: Journal of International Money and Finance, Jg. 28, Nr. 7, S. 1165–1181.

    Article  Google Scholar 

  • Horvath, R., Komarek, L., Rozsypal, F. (2011): Does Money Help Predict Inflation? An Empirical As- sessment for Central Europe, in: Economic Systems, forthcoming.

    Google Scholar 

  • Johansen, S. (1988): Statistical Analysis of Cointegrated Vectors, in: Journal of Economic Dynamics and Control, Jg. 12, Nr. 2/3, S: 231–254.

    Article  Google Scholar 

  • Johansen, S. (1991): Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models, in: Econometrica, Jg. 59, Nr. 6, S. 1551–1580.

    Article  Google Scholar 

  • Juselius, K. (2007): The Cointegrated VAR Model: Methodology and Applications, Oxford: Oxford University Press.

    Google Scholar 

  • Lee, J., Strazicich, M.-C. (2003): Minimum Lagrange Multiplier Unit Root Test with Two Structural Breaks, in: The Review of Economics and Statistics, Jg. 85, Nr. 4, S. 1082–1089.

    Article  Google Scholar 

  • MacKinnon, J.-G. (1996): Numerical Distribution Functions for Unit Root and Cointegration Tests, in: Journal of Applied Econometrics, Jg. 11, Nr. 6, S. 601–618.

    Article  Google Scholar 

  • MacKinnon, J. G., Haug, A.-A., Michelis, L. (1999): Numerical Distribution Functions of Likelihood Ratio Tests for Cointegration, in: Journal of Applied Econometrics, Jg. 14, Nr. 5, S: 563–577.

    Article  Google Scholar 

  • Nautz, D., Rondorf, U. (2010): The (In)stability of Money Demand in the Euro Area: Lessons From a Cross-Country Analysis, Free University Berlin, School of Business & Economics, Discussion Paper Series, Nr. 17.

    Google Scholar 

  • Nelson, C.-R., Plosser, C.-R. (1982): Trends and RandomWalks in Macroeconmic Time Series: Some Evidence and Implications, in: Journal of Monetary Economics, Jg. 10, Nr. 2, S. 139–162.

    Article  Google Scholar 

  • Nicoletti-Altimari, S. (2001): Does Money Lead Inflation in the Euro Area? European Central Bank, Working Paper Series, Nr. 63.

    Google Scholar 

  • Reimers, H.-E. (1992): Comparisons of Tests for Multivariate Cointegration, Statistical Papers, Jg. 33, Nr. 1, S. 335–359.

    Article  Google Scholar 

  • Reinsel, G.-C., Ahn, S.-K. (1992): Vector Autoregressive Models with Unit Roots and Reduced Rank Structure: Estimation, Likelihood Ratio Test, and Forecasting, in: Journal of Time Series Analysis, Jg. 13, Nr. 4, S. 353–375.

    Article  Google Scholar 

  • Siklos, P.-L. (2008): What Can We Learn From Comprehensive Data Revisions for Forecasting Inflation? Some U.S. Evidence, in: Forecasting in the Presence of Structural Breaks and Model Uncertain- ty, Frontiers of Economics and Globalization, Nr. 3, ed. by D. E. Rapach and M. E. Wohar, Bingley, UK: Emerald, S. 271–299.

    Google Scholar 

  • Sims, C.-A., Stock, J.-H., Watson, M.-W. (1990): Inference in Linear Time Series Models with some Unit Roots, in: Econometrica, Jg. 58, Nr. 1, S. 113–144.

    Article  Google Scholar 

  • Stavrev, E., Berger, H. (2012): The Information Content of Money in Forecasting Euro Area Inflation, in: Applied Economics, Jg. 44, Nr. 31, S. 4055–4072.

    Article  Google Scholar 

  • Von Hagen, J. (2004): Hat die Geldmenge ausgedient? Plenumsvortrag zur Jahrestagung des Vereins für Socialpolitik, in: Perspektiven der Wirtschaftspolitik, Jg. 5, Nr. 4, S. 423–453.

    Article  Google Scholar 

  • Willman, A. (2002): Euro Area Production Function and Potential Output: A Supply Side System Ap- proach, European Central Bank, Working Paper Series, Nr. 153.

    Google Scholar 

  • Woodford, M. (2008): How Important Is Money in the Conduct of Monetary Policy?, in: Journal of Money, Credit and Banking, Jg. 40, Nr. 8, S. 1561–1598.

    Article  Google Scholar 

Download references

Authors
  1. Robert Czudaj
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Hendrik Schröder Volker Clausen Andreas Behr

Rights and permissions

Reprints and permissions

Copyright information

© 2012 Springer Fachmedien Wiesbaden

About this chapter

Cite this chapter

Czudaj, R. (2012). Money or Output Gap: What Matters for Inflation in the Euro Area?. In: Schröder, H., Clausen, V., Behr, A. (eds) Essener Beiträge zur empirischen Wirtschaftsforschung. Gabler Verlag. https://doi.org/10.1007/978-3-8349-3635-6_5

Download citation

Publish with us

Policies and ethics

Search

Navigation