Recent data on Brazilian agricultural prices, industrial prices, and money supply are analyzed in a vector autoregression. The empirical findings show strong, one‐way, Granger‐type causality from money supply to agricultural prices; while feedback is observed between industrial prices and money supply. Under the usual monetarist ordering of contemporaneous innovation covariance, agricultural prices do not adjust faster than industrial prices to a shock in the money supply.
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David A. Bessler (1984) studied this question.
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