10.2307/1928168">
 

Title

Testing some monetarist propositions

Document Type

Article

Publication Date

1988

Department

Economics

Abstract

This paper attempts to reconcile the conflicting find- ings of a particular line of research designed to test Monetarism on reduced form equations. Using the encompassing approach of Mizon, the lag lengths in inflation and unemployment equations are statistically determined and then decomposed into lags due to "systematic" and "error" dynamics. Several Monetarist propositions are tested on the systematic compo- nent of each equation. The data fail to reject the restrictions imposed by Monetarism in all cases.