Henning Weber

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We use a mean-adjusted Bayesian VAR model as an out-of-sample forecasting tool to test whether money growth Granger-causes inflation in the euro area. Based on data from 1970 to 2006 and forecasting horizons of up to 12 quarters, there is surprisingly strong evidence that including money improves forecasting accuracy. The results are very robust with regard(More)
The natural interest rate is of great relevance to central banks, but it is difficult to measure. We show that in a standard microfounded monetary model, the natural interest rate co-moves with a transformation of money demand that can be computed from actual data. The optimizing central bank that cannot observe the natural interest rate takes advantage of(More)
  • EUI Working Papers, RSCAS, ROBERT SCHUMAN, Robert Schuman, Henning Weber
  • 2009
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