Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/46929 
Year of Publication: 
1994
Citation: 
[Publisher:] Institut für Weltwirtschaft (IfW) [Place:] Kiel [Year:] 1994
Series/Report no.: 
Kiel Working Paper No. 645
Publisher: 
Kiel Institute of World Economics (IfW), Kiel
Abstract: 
This paper shows that the German monetary union not only had an impact on the stability of the narrow money demand in Germany but also on the stability of the aggregate demand for money in two larger European currency areas, consisting of 3 and 7 EMS-countries. However, despite fears harbored earlier the impact was only of a temporary nature and the reunification shock did not trigger permanent disruptions. The empirical results support the continued existence of a remaining close link between real money, output, and the interest rate. This is particularly true for the aggregate demand for money in Europe. In a European Monetary Union, narrow money thus remains a potential candidate as an indicator and/or intermediate target for the European Central Bank.
Document Type: 
Working Paper
Document Version: 
Digitized Version

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