March 1991
Federal Reserve Bank of Dallas

Economic Review was published until 1999.

Forecasting the Louisiana Economy
William C. Gruben and Donald W. Hayes

William C. Gruben and Donald W. Hayes have constructed a forecasting model that predicts mild overall growth in the Louisiana economy in 1991. The model predicts expansion in seven of nine economic indicators: the rig count, the civilian labor force, nonagricultural employment, housing permits, real personal income, mining, and sales tax revenue. Only durable and nondurable goods manufacturing will decline, according to the forecast. Gruben and Hayes conclude that while Louisiana is likely to experience an economic expansion in 1991, a boom is unlikely.

Modeling the Effects of Inflation on the Demand for Money
Kenneth M. Emery

Because the Federal Reserve is responsible for controlling the value of money, economic policymakers are very concerned with forecasting the public's demand for money. Inflation is one of several factors that have made forecasting the demand for money increasingly difficult over the past fifteen years. In this article, Kenneth M. Emery reviews the ways that inflation may affect the demand for money, and he examines how well traditional money-demand models have captured these effects in the postwar period.

Emery finds that money-demand models would have performed better during 1953-79 had they included the direct effects of inflation. However, he also finds some evidence that the wide use of interest-bearing money and moderate rates of inflation during the 1980s diminished the effects of inflation on the demand for money.