Missing money found causing Australia's inflation
| Autor: | Shyama Ratnasiri, Anthony John Makin, Alex Robson |
|---|---|
| Rok vydání: | 2017 |
| Předmět: |
Inflation
Economics and Econometrics Inflation targeting Keynesian economics media_common.quotation_subject 05 social sciences Monetary policy Money supply Hyperinflation Quantity theory of money Currency 0502 economics and business Economics 050207 economics Real interest rate 050205 econometrics media_common |
| Zdroj: | Economic Modelling. 66:156-162 |
| ISSN: | 0264-9993 |
| DOI: | 10.1016/j.econmod.2017.06.009 |
| Popis: | This paper examines the nexus between excess currency growth and inflation in Australia. It first canvasses the operation of monetary policy. Using different econometric techniques, it next examines how well excess money supply growth, measured in terms of currency and M3, explains Australia's inflation over the long term from 1970–2015, and then more specifically before and after the adoption of inflation targeting. Its key result is that excess money growth has been the main determinant of Australia's inflation, although became less important during the inflation targeting era. This implies the velocity of currency, the sine qua non of the Quantity Theory of Money, has been remarkably stable. Given the role excess currency plays in generating Australian inflation, it should be afforded greater prominence in monetary policy deliberations. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
|
Full Text from ScienceDirect