Alikhanov, Murat and Taylor, Leon (2013): An algorithm for estimating the volatility of the velocity of money.
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Abstract
Most macroeconomic models, such as the ISLM, assume equilibrium in money markets. Since money demand is an inverse function of velocity, an inaccurate estimate of velocity will lead to errors in calculating the monetary and general equilibria. This note suggests a way to gauge the potential error in estimating velocity. The algorithm arises from the quantity equation of exchange, which one may prefer to an ad hoc model of velocity.
Item Type:  MPRA Paper 

Original Title:  An algorithm for estimating the volatility of the velocity of money 
Language:  English 
Keywords:  monetary policy, simulations, forecasting in transitional economies, mathematical statistics in economics 
Subjects:  E  Macroeconomics and Monetary Economics > E4  Money and Interest Rates > E47  Forecasting and Simulation: Models and Applications E  Macroeconomics and Monetary Economics > E5  Monetary Policy, Central Banking, and the Supply of Money and Credit > E52  Monetary Policy E  Macroeconomics and Monetary Economics > E5  Monetary Policy, Central Banking, and the Supply of Money and Credit > E58  Central Banks and Their Policies 
Item ID:  49313 
Depositing User:  Dr. Leon Taylor 
Date Deposited:  28 Aug 2013 16:06 
Last Modified:  30 Sep 2019 01:31 
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URI:  https://mpra.ub.unimuenchen.de/id/eprint/49313 
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