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Inflationary Expectations and the Demand for Money: „The Greek Experience“ A Comment and Some Different Results

Inflationary Expectations and the Demand for Money: „The Greek Experience“ A Comment and Some Different Results
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Year:    1983

Author:    Himarios, Daniel

Credit and Capital Markets – Kredit und Kapital, Vol. 16 (1983), Iss. 2 : pp. 253–264

Abstract

Inflationary Expectations and the Demand for Money: The Greek Experience A Comment and Some Different Results

This note addresses two points in the Brissimies and Leventakis (1981) paper. First, we argue that the authors have committed a serious theoretical error in, unknowingly, identifying rational expectations with perfect foresight. We show that, under their assumptions, their results are biased and inconsistent. Second, we reexamine their conclusion that “the market for M1 is segmented from the markets for either financial or real assets”. A careful examination of the data and a correctly specified money demand equation support the exactly opposite hypothesis with a high degree of confidence.

Journal Article Details

Publisher Name:    Global Science Press

Language:    Multiple languages

DOI:    https://doi.org/10.3790/ccm.16.2.253

Credit and Capital Markets – Kredit und Kapital, Vol. 16 (1983), Iss. 2 : pp. 253–264

Published online:    1983-02

AMS Subject Headings:    Duncker & Humblot

Copyright:    COPYRIGHT: © Global Science Press

Pages:    12

Author Details

Himarios, Daniel

  1. Inflationary Finance and the Demand for Money in Greece

    Tavlas, George S.

    Credit and Capital Markets – Kredit und Kapital, Vol. 20 (1987), Iss. 2 P.245

    https://doi.org/10.3790/ccm.20.2.245 [Citations: 0]

  2. “Inflationary Expectations and the Demand for Money: The Greek Experience”

    Smith, Gregor W.

    Credit and Capital Markets – Kredit und Kapital, Vol. 18 (1985), Iss. 4 P.527

    https://doi.org/10.3790/ccm.18.4.527 [Citations: 0]

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  20. Brissimis, L. N. and J. A. Leventakis: “Inflationary Expectations and the Demand for Money: The Greek Experience”. Kredit und Kapital, 4/1981.  Google Scholar
  21. Chow, G.: “On the Long-run and Short-run Demand for Money”. Journal of Political Economy, Vol. 74, No. 2 (April 1966).  Google Scholar
  22. Griliches, Z.: “Distributed Lags: A Survey”. Econometrica, Vol. 35 (1967).  Google Scholar
  23. Himarios, D.: “Properties and Stability of the Demand for Money in Developing Economies with a Particular Application to Greece”. Working Paper E-81-12-01, Economics Department, VPI& SU (1982).  Google Scholar
  24. Jacobs, R.J.: “Estimating the Long-run Demand for Money from Time-Series Data”. Journal of Political Economy, Vol. 82, No. 6 (Nov/Dec 1974).  Google Scholar
  25. McCallum, B. T.: “Rational Expectations and the Estimation of Econometric Models: An Alternative Procedure”. International Economic Review, Vol. 17, No.2 (June 1976).  Google Scholar
  26. Papadakis, J.: Money and Economic Activity: The Greek Experience 1950 - 1975(Institute of Economic and Industrial Research), Athens, 1979 (in Greek).  Google Scholar
  27. Zolatas, X.: Monetary Equilibrium and Economic Development. (Princeton University Press, Princeton, NJ), 1965.  Google Scholar

Section Title Page Action Price
Daniel Himarios: Inflationary Expectations and the Demand\rfor Money: The Greek Experience 253
I. 253
II. 255
III. 261
Appendix 263
References 263
Zusammenfassung: Inflationäre Erwartungen und die Geldnachfrage:\rDie griechische Erfahrung — Ein Kommentar\rund einige abweichende Resultate 263
Summary: Inflationary Expectations and\rthe Demand for Money: The Greek Experience\rA Comment and Some Different Results 264
Résumé: Anticipations inflationnistes et demande monétaire:\rL'expérience grecque — Un commentaire et quelques résultats différents 264