Are Weighted Monetary Aggregates Better the Simple-Sum M1?

A number of analysts believe that these financial developments have altered significantly the relationship between Ml growth and the gr’owth of GNP. rendering the narrow monetaiy aggregate less usefi.rl as an intermediate target for monetary policy.’ Others have objected on broader grounds, arguing that these innovations illuminate the problem of simply adding up various financial assets currency, demand deposits, NOW accounts, etci to obtain a “simple-sum” monetary aggr’egate. They aigue that various assets have different degrees of “monevness’ — that is, the