TY  - JOUR
AU  - Mitchener,Kris James
AU  - Weidenmier,Marc D.
TI  - Searching for Irving Fisher
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 15670
PY  - 2010
Y2  - January 2010
UR  - http://www.nber.org/papers/w15670
L1  - http://www.nber.org/papers/w15670.pdf
N1  - Author contact info:
Kris James Mitchener
Department of Economics
Leavey School of Business
Santa Clara University
Santa Clara, CA 95053
Tel: 408/554-4340
Fax: 408/554-2331
E-Mail: kmitchener@scu.edu

Marc D. Weidenmier
Robert Day School of Economics and Finance
Claremont McKenna College
500 East Ninth Street
Claremont, CA 91711
Tel: 909/607-8497
Fax: 909/621-8249
E-Mail: marc_weidenmier@claremontmckenna.edu
AB  - There is a long-standing debate as to whether the Fisher effect operated during the classical gold standard period. We break new ground on this question by developing a market-based measure of general inflation expectations during the gold standard. Since the gold-silver price ratio was widely used to track inflation during the gold standard period, we are able to derive a measure of inflation expectations using the interest-rate differential between Austrian silver and gold perpetuity bonds with identical terms. Our empirical evidence suggests that inflation expectations exhibited significant persistence at the weekly, monthly, and annual frequencies. We also find that market participants updated long-run inflation expectations following short-run changes in the forward silver price of gold. The evidence suggests the operation of a long-run Fisher effect during the classical gold standard period.
ER  -