Deficits, money and inflation: Comment

This paper re-examines the fiscal policy-money growth linkage analysed by Hamburger-Zwick (1981) in this Journal. Newly revised national income accounts data are employed. Unlike Hamburger-Zwick we do not find any strong evidence of a positive Federal budget deficit-money growth relationship over the period 1961–1974. When the estimation period is extended to 1976 and then to 1978, the results suggest no relationship between deficits and money growth.