Money And Inflation: Some Critical Issues

The authors consider what, if any, relationship there is between monetary aggregates and inflation, and whether there is any substantial reason for modifying the current mainstream mode of policy analysis, which frequently does not consider monetary aggregates at all. They begin by considering the body of thought known as the "Quantity theory of money." The quantity theory centers on the prediction that there will be a long-run proportionate reaction of the price level to an exogenous increase in the nominal money stock.

Provided by: Federal Reserve Board Topic: CXO Date Added: Oct 2010 Format: PDF

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