HOUSING WEALTH AND U.S. MONEY DEMAND: A PANEL ESTIMATION.

This article estimates a panel model for U.S. money demand using annual state-level data for the period from 1977 to 2008. We incorporate housing wealth in the demand-for-money function and find strong evidence of a relationship between a broad monetary aggregate and housing wealth. This finding is...

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Publicado en:Contemporary Economic Policy Vol. 29; no. 3; pp. 382 - 392
Autores principales: ARNOLD, IVO J. M., ROELANDS, SEBASTIAN
Formato: Artículo
Publicado: Wiley-Blackwell Jul2011
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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          ARNOLD, IVO J. M.
          ROELANDS, SEBASTIAN
        affil:
          Arnold: Professor of Economics, Erasmus School of Economics, Erasmus University Rotterdam, P.O. Box 1738, 3000 DR Rotterdam, The Netherlands; Nyenrode Business Universiteit, Straatweg 25, 3621 BG, Breukelen, The Netherlands. Phone +31 (0)10 4081254, Fax +31 (0)10 4089161, E-mail
          Roelands: PhD student, Department of Economics and Econometrics, University of Notre Dame, 434 Flanner Hall, Notre Dame, IN 46556, USA. E-mail
      su:
        United States
        Money supply
        Business cycles
        Housing finance
        Demand for money
        Home prices
        Real estate business
      sug:
        subj:
          Money supply
          Business cycles
          Housing finance
          United States
          Other Community Housing Services
          Other Activities Related to Real Estate
          Offices of Real Estate Agents and Brokers
          Lessors of Residential Buildings and Dwellings
          Offices of real estate brokers
          Demand for money
          Home prices
          Real estate business
      ab: This article estimates a panel model for U.S. money demand using annual state-level data for the period from 1977 to 2008. We incorporate housing wealth in the demand-for-money function and find strong evidence of a relationship between a broad monetary aggregate and housing wealth. This finding is robust to the inclusion of variables measuring financial heterogeneity across U.S. regions. Breaking up the sample in two subperiods shows that panel estimates including housing wealth yield more stable coefficients than both time-series estimates and panel estimates excluding housing wealth. We also show that the link between money and housing wealth predates the recent boom-and-bust cycle. ( JEL E41, E52)
      pubtype: Academic Journal
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    language: English
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