Money in models of real business cycle
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The perception of real business cycle (RCB) conceived in the early 1980s has helped to merge periodic oscillation with growth theory. In their initial form the RBC models were short of any monetary variables. Money was only later included in equations that replicate the economic system. Analysis of those models were used to support the view that money itself is not determining business oscillations and that it could be perceived as a variable that is internally influenced by the real sphere. The inclusion of money into RBC model has not, however, produced unequivocal results. The need to study the interactions between business cycle oscillations and the monetary variables in greater detail is still felt.
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