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The Holmes-Smyth effect: some preliminary exercises with the UK demand for narrow money

Authors
Publisher
Routledge
Publication Date
Keywords
  • Secs-P/01 Economia Politica

Abstract

The Primary purpose of this paper is to test a plausible data-coherent representation of the consumption based model of the demand for money against and analogus representation of the standard income based formulation. On the basis of non-nested tests, neither model canbe maintained. Consequently, the possibility of tax cuts being contractionary (the Holmes-smyth effect) is still an open question

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