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Shyh-Wei Chen
 
''Evidence of the Long-Run Neutrality of Money: The Case of South Korea and Taiwan''
( 2007, Vol. 3 No.64 )
 
 
This paper investigates the long-run neutrality of money using quarterly data of South Korea and Taiwan and the methodology of King and Watson (1997) particular attention is given to the integration and cointegration properties of the variables. Empirical evidence provides considerable support for the long-run neutrality of money with respect to real output in the case of South Korea, indicating that it is consistent with two of the business cycle, i.e, the monetary intertemporal model and the monetary misperceptions theory. There is little evidence that the long-run monetary neutrality hypothesis holds in the case of Taiwan. Based on the estimated results, the hypothesis of the short-run neutrality of money is rejected for both countries.
 
 
Keywords:
JEL:
E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit: General
 
Manuscript Received : Jun 21 2007 Manuscript Accepted : Nov 30 2007

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