Money Creation and Economic Activity, 1967-1982

Because of a publication lag and continuous revisions of seasonally adjusted data, little attention is paid to money supply figures as an indicator of actual monetary conditions in the Netherlands. However, the information that can be derived from money supply figures is limited due to temporary dis...

Full description

Saved in:
Bibliographic Details
Published in:De Economist (Netherlands) 1983-01, Vol.131 (4), p.498
Main Authors: Bomhoff, Eduard J, Veugelers, Paul T. W. M.
Format: Article
Language:English
Subjects:
Corrections
Economic activity
Economic growth
Economic policy
Economic theory
Effectiveness
Foreign exchange markets
Foreign exchange rates
GNP
Gross National Product
Money supply
Predictions
Statistical analysis
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Because of a publication lag and continuous revisions of seasonally adjusted data, little attention is paid to money supply figures as an indicator of actual monetary conditions in the Netherlands. However, the information that can be derived from money supply figures is limited due to temporary disturbances generated by the foreign exchange market. A correction method using a transformed regression equation to remove temporary aberrations is proposed. Corrected money supply figures show a much closer link to real economic activity. The research confirms that changes in money have an important short-term effect on economic growth. In Holland, abrupt changes in monetary policy have been an important cause of short-term changes in economic growth. Recent events have revealed that the lack of a well-defined, medium-term policy demands absolute confidence in the exchange rate policy. Doubts about the exchange rate will probably continue for some time.
ISSN:0013-063X
1572-9982
DOI:10.1007/BF02109407