European Evidence on the Long-Run Superneutrality of Money Cover Image

European Evidence on the Long-Run Superneutrality of Money
European Evidence on the Long-Run Superneutrality of Money

Author(s): Oleg Deev, Martin Hodula
Subject(s): Supranational / Global Economy, Political economy, Financial Markets
Published by: Masarykova univerzita
Keywords: money superneutrality; SVAR;
Summary/Abstract: This paper investigates the validity of the money superneutrality concept for the sample of 30 European economies. Using a structural vector autoregressive framework, we examine the long-run response of real output to a permanent inflation shock for each country. We find that for the majority of countries in our sample the long- run superneutrality concept is confirmed as the original increase/decrease in output growth fades in time. We also fail to proof the additional hypothesis that the exception to superneutrality validity is a group of countries with smaller in-sample inflation mean.

  • Page Range: 79-86
  • Page Count: 8
  • Publication Year: 2015
  • Language: English