2019-09-23T09:52:28Zhttps://grips.repo.nii.ac.jp/?action=repository_oaipmhoai:grips.repo.nii.ac.jp:000009582019-04-16T01:34:55Z00001:00043
DEVOLUTION OF THE FISHER EQUATION: Rational Appreciation to Money IllusionengFisher equationFisher hypothesisFisher effectmoney illusionnominal interest ratepurchasing power of moneyvalue of moneyhttp://id.nii.ac.jp/1295/00000958/info:doi/10.24545/00000958Technical ReportRHODES, James R.政策研究大学院大学 / National Graduate Institute for Policy StudiesIn Appreciation and Interest Irving Fisher (1896) derived an equation connecting interest rates in any two standards of value. The original Fisher equation (OFE, 1896) was expressed in terms of the expected appreciation of money (the real return on money) whereas the conventional Fisher equation (CFE, 1930) uses expected inflation. Since the OFE is based on the value of money (l/P) it is not subject to standard criticisms of irrationality leveled against the CFE. Fisher's puzzling substitution of lagged inflation for money appreciation in 1930 is resolved by taking into account his theory of "money illusion."JEL Classification Codes: B00, E40, B13, B22, B31Revised version: Discussion Paper : 07-05GRIPS Research Report SeriesI-2006-00022006-06GRIPS Policy Information Center©2006 by James R. Rhodes. All rights reserved.http://www.grips.ac.jp/list/jp/facultyinfo/rhodes_james/authorhttps://grips.repo.nii.ac.jp/?action=repository_action_common_download&item_id=958&item_no=1&attribute_id=20&file_no=12015-02-25