Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/88210
Authors: 
Setzer, Ralph
van den Noord, Paul
Wolff, Guntram B.
Year of Publication: 
2010
Series/Report no.: 
ROME Discussion Paper Series 10-09
Abstract: 
In this paper we examine why monetary aggregates of euro area Member States have developed differently since the inception of the euro. We derive a money demand equation that incorporates housing wealth and collateral as well as substitution effects on real money holdings. Empirically, we show that cross-country differences in real balances are determined not only by income differences, a standard determinant of money demand, but also by house price developments. Higher house prices and higher user costs of housing are both associated with larger money holdings. Country-specific money holdings are also connected with structural features of the housing market.
Subjects: 
Money
housing
national contribution
euro area
JEL: 
E41
E51
E52
Document Type: 
Working Paper

Files in This Item:
File
Size
204.32 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.