Abstract
A model of world output and inflation is developed from the Quantity Theory of Money cast in global terms. It includes a market for commodities and an exogenous oil price. The properties of the model, which are presented in terms of its tracking performance over the period 1970-1979 and in terms of shocks to the money supply and to the oil price, corroborate the Quantity Theory approach in the sense that in the long run the price level reflects the quantity of money while output is determined by real phenomena.
Original language | English |
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Pages (from-to) | 261-285 |
Number of pages | 25 |
Journal | European Economic Review |
Volume | 21 |
Issue number | 3 |
DOIs | |
State | Published - May 1983 |
Externally published | Yes |