The study showed that the M2 monetary aggregate
was cointegrated with real income, real interest rates, nominal interest of medium-term maturity, and the inflation rate, but not with the interest rate of short-term maturity.
MSI-M1 and MSI-M2 are constructed, respectively, over the same components included in the Federal Reserve Board's M1 and M2 monetary aggregates
Rather than refine the opportunity cost or redefine the M2 monetary aggregate
, Carlson et al.
Bordo, Choudhri, and Schwartz (1995) estimate a vector error correction model (VECM) using quarterly data from 1921:Q1 to 1941:Q4 for three variables--real gross domestic product (GDP), the implicit GDP deflator, and the M2 monetary aggregate
The broader M2 monetary aggregate
has grown at more moderate rates, 10.
The M2 monetary aggregate
, a fairly broad definition of money, is used in the graphical analysis.