Disequilibrium in Money Demand Could Impact Future Economic Growth
The study looked at what factors influence how much money people want to hold in Australia. They used a method called Johansen cointegration to analyze data from 1976 to 2002. The findings show that the demand for money is connected to real income, bond returns, interest rates, and inflation. If there's an imbalance in money demand, it can impact how effective interest rate policies are in the long run by affecting future economic growth.