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In this paper we examine why monetary aggregates of euro area Member States have developed differently since the inception of the euro. We derive a money demand equation that incorporates housing wealth and collateral as well as substitution effects on real money holdings. Empirically, we show...
Persistent link: https://www.econbiz.de/10008509091
This paper reviews theory and evidence of the welfare effects of inflation from a costbenefit perspective. Basic models and selected empirical results are discussed. Historically, in assessing the welfare effects of inflation, the distortion of money demand played a prominent role. More...
Persistent link: https://www.econbiz.de/10005083118
This paper empirically investigates whether individuals withhold a certain amount of cash for precautionary reasons at the point-of-sale (POS) in order to be able to cover future transactions that might have to be paid for in cash. Such behaviour is costly for consumers because it imposes...
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We measure consumers' use of cash by harmonizing payment diary surveys from seven countries: Australia, Austria, Canada, France, Germany, the Netherlands, and the United States (conducted 2009 through 2012). Our paper finds important cross-country differences, for example, the level of cash...
Persistent link: https://www.econbiz.de/10010957141
The European Central Bank has assigned a special role to money in its two pillar strategy and has received much … bank's interest rate rule is based on a standard model of the monetary transmission process that underlies many … deviations of long-run money growth helps the central bank to overcome this bias. Our argument in favor of ECB-style cross …
Persistent link: https://www.econbiz.de/10005083254