To Örebro University

oru.seÖrebro University Publications
Change search
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf
Does money growth predict inflation in Sweden? Evidence from vector autoregressions using four centuries of data
Department of Economic History, Stockholm University, Stockholm, Sweden.
Örebro University, Örebro University School of Business.ORCID iD: 0000-0003-0203-4688
National Institute of Economic Research, Stockholm, Sweden.
2024 (English)In: Empirical Economics, ISSN 0377-7332, E-ISSN 1435-8921Article in journal (Refereed) Epub ahead of print
Abstract [en]

In this paper, we add new evidence to a long-debated macroeconomic question, namely, whether money growth has predictive power for inflation or put differently, whether money growth Granger causes inflation. We use a historical dataset-consisting of annual Swedish data on money growth and inflation ranging from 1620 to 2021-and employ state-of-the-art Bayesian estimation methods. Specifically, we employ VAR models with drifting parameters and stochastic volatility which are used to conduct analysis both within- and out-of-sample. Our results indicate that the within-sample analysis-based on marginal likelihoods-provides strong evidence in favour of money growth Granger causing inflation. This strong evidence is, however, not reflected in our out-of-sample analysis, as it does not translate into a corresponding improvement in forecast accuracy.

Place, publisher, year, edition, pages
Springer, 2024.
Keywords [en]
Time-varying parameters, Stochastic volatility, Out-of-sample forecasts, E31, E37, E47, E51, N13
National Category
Economics
Identifiers
URN: urn:nbn:se:oru:diva-117582DOI: 10.1007/s00181-024-02684-yISI: 001363219200001Scopus ID: 2-s2.0-85210397323OAI: oai:DiVA.org:oru-117582DiVA, id: diva2:1918443
Funder
The Jan Wallander and Tom Hedelius Foundation, P18-0201Swedish Research Council, 2023-00605Örebro UniversityAvailable from: 2024-12-05 Created: 2024-12-05 Last updated: 2025-01-20Bibliographically approved

Open Access in DiVA

No full text in DiVA

Other links

Publisher's full textScopus

Authority records

Karlsson, Sune

Search in DiVA

By author/editor
Karlsson, Sune
By organisation
Örebro University School of Business
In the same journal
Empirical Economics
Economics

Search outside of DiVA

GoogleGoogle Scholar

doi
urn-nbn

Altmetric score

doi
urn-nbn
Total: 71 hits
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf