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the dependent variable. In estimating the effect of money in real output, a
coefficient of 0.174 is obtained for the long-term, while in the short-term a value of
0.315 is found.
The short-term comprises from the first quarter of 1993 to the second quarter of
2014 regarding M1 and from the second quarter of 1993 to the second quarter of
2014, for the short-term
As a result, changes in the money supply have an
inelastic effect in the level of output.
From here it follows that money supply has a
positive incidence, albeit small, in the level of real output. Since both coefficients
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In Annex II, cointegration tests for equation variables are being reported.
Stationary results of residuals for short-term estimates are exposed in Annex III.
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Variable nemonics and data sources are provided in Annex I.
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The above coefficients expose a high significance,
i.e.
99%, both in the long and
short-term.