The demand for money: A structural econometric investigation

Donald H. Dutkowsky, H. Sonmez Atesoglu

Research output: Contribution to journalArticle

6 Scopus citations

Abstract

This study empirically investigates dynamic microfoundations for the conventional static money demand equation. An intertemporal substitution model with the addilog utility function yields a money demand relationship that closely approximates the double log specification. Results from previous empirical studies largely support the derived equation. Estimations with quarterly U.S. data support cointegration among real per capita Ml and consumption, and an after-tax long-term interest rate for the post-1980 period. Estimated short-run intertemporal interest rate elasticities of consumption vary from -0.26 to -0.93. Estimated long-run elasticities of substitution between consumption and money range from -0.26 to -0.41.

Original languageEnglish (US)
Pages (from-to)92-106
Number of pages15
JournalSouthern Economic Journal
Volume68
Issue number1
DOIs
StatePublished - Jan 1 2001

ASJC Scopus subject areas

  • Economics and Econometrics

Fingerprint Dive into the research topics of 'The demand for money: A structural econometric investigation'. Together they form a unique fingerprint.

  • Cite this