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To detect the quantity theory of money, we follow Lucas (1980) by looking at scatter plots of filtered time series of … monetary policy rules. -- Quantity theory ; policy regimes ; time-varying VAR …
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Short answer: It helps a lot when other important variables are excluded from the information set. Longer answer: We revisit claims in the literature that money growth is Granger-causal for inflation at low frequencies. Applying frequency-specific tests in a comprehensive system setup for...
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