The Demand for Money in Cote d’Ivoire: Evidence from the Cointegration Test
AbstractThis paper demonstrates that there is a long run equilibrium relationship between money supply 〖(M〗_1) and its main determinants, real income (GDP) and interest rate in Cote d’Ivoire. In order to investigate long-term relationship among these variables, we use Juselius and Johansen cointegration test with time series data covering the period of 1980-2007. The results show that there is long-term relationship among these variables as well as the linkage between them. Base from this result we found that only real money balances 〖(M〗_1) has significant long -run economic impact of variations in monetary policy in Cote d’Ivoire. However, the study also revealed that the effect of aggregate 〖(M〗_2) is not so stable linking with it determinants.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 20131.
Date of creation: 19 Jan 2010
Date of revision:
Cointegration test; Money demand;
Find related papers by JEL classification:
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-01-30 (All new papers)
- NEP-MAC-2010-01-30 (Macroeconomics)
- NEP-MON-2010-01-30 (Monetary Economics)
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