ERM Money Supplies and the Transition to EMU /
Stage 2 of monetary union in the Europe is to involve greater monetary cooperation; the paper examines the case for using the M3 money supply aggregated across 'core ERM' countries- -those with low inflation and absence of realignments- -as a vehicle for that cooperation. First, the existe...
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| Other Authors: | , |
| Format: | Journal |
| Language: | English |
| Published: |
Washington, D.C. :
International Monetary Fund,
1994.
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| Series: | IMF Working Papers; Working Paper ;
No. 1994/001 |
| Online Access: | Full text available on IMF |
| Summary: | Stage 2 of monetary union in the Europe is to involve greater monetary cooperation; the paper examines the case for using the M3 money supply aggregated across 'core ERM' countries- -those with low inflation and absence of realignments- -as a vehicle for that cooperation. First, the existence of a satisfactory long-run money demand relationship and short-run dynamic equation is verified. The resulting demand equations have at least as satisfactory econometric properties as those for France and Germany separately. Second, the predictive power of the core-ERM aggregate relative to French and German inflation is examined; it is shown that the aggregate helps to predict German inflation, over and above the predictive power of German M3. Thus, core-ERM M3 has value as an indicator for the anchor country in hitting its own domestic objective, quite separate from any concern about economic developments in neighboring countries. |
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| Item Description: | <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required |
| Physical Description: | 1 online resource (42 pages) |
| Format: | Mode of access: Internet |
| ISSN: | 1018-5941 |
| Access: | Electronic access restricted to authorized BRAC University faculty, staff and students |