Summary
This paper examines the impact of wealth on the demand for money in The Netherlands and Belgium. The empirical analysis reveals a substantial influence of wealth on the demand for money. For The Netherlands, incorporating wealth effects mitigates the volatility of the monetary picture. For Belgium this is not the case, indicating that interest and inflation rates are very important for understanding the monetary developments.
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We are indebted to Michel Dombrecht of De Nationale Bank van België for providing the data on wealth for Belgium. Helpful comments by Professors S.K. Kuipers and F.C. Palm are gratefully acknowledged.
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Fase, M.M.G., Winder, C.C.A. Wealth and the demand for money: Empirical evidence for the Netherlands and Belgium. De Economist 144, 569–589 (1996). https://doi.org/10.1007/BF01371940
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DOI: https://doi.org/10.1007/BF01371940