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More evidence on the asymmetric effects of exchange rate changes on the demand for money: evidence from Asian

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  • Mohsen Bahmani-Oskooee
  • Dan Xi
  • Sahar Bahmani

Abstract

We try to assess the impact of exchange rate changes on the demand for money in eight Asian countries. When we followed the previous literature and the standard linear Autoregressive Distributed Lag (ARDL) approach, we found exchange rate changes had no long-run significant effects in five out of the eight countries in our sample. However, when we applied the nonlinear ARDL approach and separated appreciations from depreciations, at least one of them or both had significant effects on the demand for money in India, Indonesia, Korea, the Philippines, and Singapore, supporting asymmetric effects of exchange rate changes. There was also evidence of short-run asymmetric effects.

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  • Mohsen Bahmani-Oskooee & Dan Xi & Sahar Bahmani, 2019. "More evidence on the asymmetric effects of exchange rate changes on the demand for money: evidence from Asian," Applied Economics Letters, Taylor & Francis Journals, vol. 26(6), pages 485-495, March.
    • Handle: RePEc:taf:apeclt:v:26:y:2019:i:6:p:485-495
    DOI: 10.1080/13504851.2018.1486979
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    Cited by:

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    3. Sy Hoa Ho & Jamel Saadaoui, 2019. "Symmetric and asymmetric effects of exchange rates on money demand: Empirical evidence from Vietnam," Working Papers hal-02421007, HAL.
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    5. Huthaifa Alqaralleh & Alaa Adden Abuhommous & Ahmad Alsaraireh, 2020. "Modelling and Forecasting the Volatility of Cryptocurrencies: A Comparison of Nonlinear GARCH-Type Models," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(4), pages 346-356, July.
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