scholarly journals The Stability of the Short-Run Money Demand Function, 1920-1939

1982 ◽  
Author(s):  
R. W. Hafer
Keyword(s):  
Money Demand ◽  
Demand Function ◽  
Money Demand Function ◽  
Short Run ◽  
The Stability

scholarly journals Comparative Analysis of the Stability of Money Demand between Côte d’Ivoire And Ghana: An Application of ARDL Model

2017 ◽  
Vol 9 (11) ◽  
pp. 163
Author(s):  
Yao Kouadio Ange-Patrick ◽  
Drama Bédi Guy Hervé
Keyword(s):  
Cote D'ivoire ◽  
Money Demand ◽  
Côte D’Ivoire ◽  
Demand Function ◽  
African Countries ◽  
Money Demand Function ◽  
Cote D’Ivoire ◽  
Côte D'ivoire ◽  
Short Run ◽  
The Stability

This paper empirically examined the broad money demand function and its stability in two West African countries namely Cote d’Ivoire and Ghana covering the period of 1980 to 2015 using the Autoregressive Distributed Lag (ARDL) Bounds testing procedure. The empirical results confirm the stability of the money demand function and support the choice of M2 as a viable instrument for policy implementation in both countries cited above. The study also demonstrates that a long-run relationship exists between money aggregate (M2) and its determinants during the study period. In fact, the real income tends to be the most significant factor explaining the demand for broad money in both countries. In addition, the overall short run estimation of our model is statistically significant for Cote d’Ivoire and insignificant for Ghana at the conventional level. This means that money demand is stable for Cote d’Ivoire in short run and unstable for Ghana in the same period. It is recommended that monetary policy authorities should continue to implement policies that will reinforce macroeconomic stability and facilitate economic growth.

scholarly journals On the (Ir)Relevance of Monetary Aggregate Targeting in Pakistan: An Eclectic View

2013 ◽  
Vol 18 (2) ◽  
pp. 65-119
Author(s):  
Adnan Haider ◽  
Asad Jan ◽  
Kalim Hyder
Keyword(s):  
Monetary Policy ◽  
Money Demand ◽  
Demand Function ◽  
Policy Framework ◽  
Monetary Aggregate ◽  
Money Demand Function ◽  
Financial Innovations ◽  
The Stability ◽  
Nominal Anchor ◽  
Monetary Policy Framework

This study attempts to identify a stable money demand function for Pakistan’s economy, where the monetary aggregate is considered the nominal anchor. With evolving financial innovations and regulations, the stability of money demand has been the focus of numerous debates. Where earlier studies have provided conflicting explanations due to inadequate specifications and imprecise estimations, we find that money demand in Pakistan is stable, if specified properly. For developing countries such as Pakistan, it is important to target monetary aggregates or respond to deviations from the desirable path if monetary policy is to be effectively implemented and communicated; this should remain, if not a primary, then an auxiliary target in the monetary policy framework.

Testing the stability of money demand function in Lesotho

2018 ◽  
Vol 10 (4) ◽  
pp. 383
Author(s):  
Moeti Damane ◽  
Lira P. Sekantsi ◽  
Senei Solomon Molapo
Keyword(s):  
Money Demand ◽  
Demand Function ◽  
Money Demand Function ◽  
The Stability

Testing the stability of money demand function in Lesotho

2018 ◽  
Vol 10 (4) ◽  
pp. 383
Author(s):  
Moeti Damane ◽  
Lira P. Sekantsi ◽  
Senei Solomon Molapo
Keyword(s):  
Money Demand ◽  
Demand Function ◽  
Money Demand Function ◽  
The Stability

scholarly journals Financial Development and Money Demand Function: Cointegration, Causality and Variance Decomposition Analysis for Pakistan

2017 ◽  
Vol 18 (4) ◽  
pp. 811-824 ◽  
Author(s):  
Muhammad Ahad
Keyword(s):  
Exchange Rate ◽  
Financial Development ◽  
Money Demand ◽  
Industrial Production ◽  
Unit Root ◽  
Demand Function ◽  
Decomposition Analysis ◽  
Money Demand Function ◽  
Long Run ◽  
Short Run

This study has investigated money demand function incorporating financial development, industrial production, income and exchange rate for Pakistan for time span from 1972 to 2012. Bayer–Hanck combined cointegration and Johansen cointegration approaches have been used to test cointegration among variables and vector error correction model (VECM) approach has been applied to explain the direction of causality in the long run and short run. Unit root problem has been tested by augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) unit root tests. The results indicate that feedback effect is found between financial development and money demand. There is a long-run relationship existing among money demand, financial development, income, industrial production and exchange rate. Financial development is the main factor to determine money demand function in both long run and short run.

scholarly journals Structural Adjustment And The Stability Of The Nigerian Money Demand Function

2011 ◽  
Vol 3 (8) ◽  
Author(s):  
Olugbenga A. Onafowora ◽  
Oluwole Owoye
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Money Demand ◽  
Structural Adjustment ◽  
Demand Function ◽  
Money Demand Function ◽  
The Real ◽  
Long Run ◽  
The Stability ◽  
Domestic Interest Rate

This paper uses cointegration vector error correction analysis to test the stability of the demand for real broad money (M2) in Nigeria over the quarterly period 1986:1 to 2001:4 in order to ascertain whether recent macroeconomic developments such as the implementation of the structural adjustment programme (SAP) in 1986; the liberalization of the exchange rate, domestic interest rate, and capital accounts; financial deepening and innovations; changes in monetary policy regimes; and increased integration of the economy with the rest of the world may have caused the real broad money demand function to become structurally unstable. Our empirical results indicate that there exists a long-run relationship between the real broad money aggregate, real income, inflation rate, domestic interest rate, foreign interest rate, and expected exchange rate. Furthermore, both the CUSUM and CUSUMSQ tests confirm the stability of the short- and long run parameters of the real money demand function. The stability of the parameters of the money demand equation provides the justification for the monetary authority to target the broad money supply in its bid to manage inflation and stimulate economic activity in Nigeria.

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