Abstract
The effect of monetary policy and inflation upon the ownership claims to real capital has been studied by several disciplines. In financial economics, the major thrust of research has been to analyze empirically the reaction of the stock market to changes in macroeconomic variables such as the money supply and inflation. In the monetary (macro) economics literature, the impact of changes in the money supply and inflation upon aggregate employment, output and investment is often studied. In contrast to the finance studies, this research typically models the structure of the economy's demand and supply functions and solves for equilibrium prices by imposing rational expectations. Finally, research in international economics evaluates the impact of alternative monetary transmission mechanisms (e.g., exchange rate policies) upon aggregate economic activity. Although these research topics seem to be highly related, the various literatures are almost totally isolated from each other.
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