IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

Money and Productive Efficiency: Evidence from a High-Inflation Country

  • Erdem BaÅçi
  • Syed F. Mahmud
  • Eray M. Yucel

This paper examines how money balances held by manufacturing firms affect their efficiency in generating sales revenue in a high-inflation economy. The analysis employs data from Turkish firms to estimate a stochastic frontier model, finding a strong positive association between the firms' money holdings and their efficiency. However, the role of money balances seems to diminish as firms hold higher raw material inventories.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://mesharpe.metapress.com/link.asp?target=contribution&id=9556772077384155
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by M.E. Sharpe, Inc. in its journal Emerging Markets Finance and Trade.

Volume (Year): 43 (2007)
Issue (Month): 1 (February)
Pages: 64-73

as
in new window

Handle: RePEc:mes:emfitr:v:43:y:2007:i:1:p:64-73
Contact details of provider: Web page: http://mesharpe.metapress.com/link.asp?target=journal&id=111024

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Anonymous, 1993. "Economic forecast overview and summary table," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 56, September.
  2. -, 1993. "International economic highlights 1992," Oficina de la CEPAL en Washington (Estudios e Investigaciones) 28937, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  3. Bhattacharya, Sudipto & Boot, Arnoud W.A. & Thakor, Anjan V., 1995. "The economics of bank regulation," DEE - Working Papers. Business Economics. WB 7082, Universidad Carlos III de Madrid. Departamento de Economía de la Empresa.
  4. anonymous, 1995. "Georgia economy strong even without Olympics," Regional Update, Federal Reserve Bank of Atlanta, issue Oct, pages 11-13.
  5. -, 1995. "International economic highlights 1994," Oficina de la CEPAL en Washington (Estudios e Investigaciones) 28948, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  6. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
  7. -, 1993. "Evolución de la economía brasileña," Informe Estadístico – Oficina de la CEPAL en Brasilia 28091, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  8. Anonymous, 1993. "Economic forecasts overview," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 56, March.
  9. Hasan, M Aynul & Mahmud, Syed F, 1993. "Is Money an Omitted Variable in the Production Function? Some Further Results," Empirical Economics, Springer, vol. 18(3), pages 431-45.
  10. anonymous, 1993. "Kelley touts economy's underlying strength," Economics Update, Federal Reserve Bank of Atlanta, issue Jan, pages 7.
  11. Garnaut, Ross & Ma, Guonan, 1993. "Economic growth and stability in China," Journal of Asian Economics, Elsevier, vol. 4(1), pages 5-24.
  12. Anonymous, 1993. "Economic notes," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 56, March.
  13. Anonymous, 1993. "Contents of Agricultural Economics, Vol. 9," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 9(4), December.
  14. Christopher F. Baum & Mustafa Caglayan & Neslihan Ozkan & Oleksandr Talavera, 2004. "The Impact of Macroeconomic Uncertainty on Cash Holdings for Non-Financial Firms," Discussion Papers of DIW Berlin 410, DIW Berlin, German Institute for Economic Research.
  15. -, 1993. "Economic survey of Canada, 1992," Oficina de la CEPAL en Washington (Estudios e Investigaciones) 28939, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  16. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
  17. anonymous, 1982. "International economic situation and outlook," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 45, january/f.
  18. Lawrence J. Christiano & Martin Eichenbaum & Charles L. Evans, 1996. "Sticky Price and Limited Participation Models of Money: A Comparison," NBER Working Papers 5804, National Bureau of Economic Research, Inc.
  19. -, 1995. "Evolución de la economía brasileña," Informe Estadístico – Oficina de la CEPAL en Brasilia 28113, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  20. N/A, 1982. "Chapter II. the World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 102(1), pages 27-38, November.
  21. Jansen, Dennis W, 1985. "Real Balances in an Ad Hoc Keynesian Model and Policy Ineffectiveness: A Note," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 17(3), pages 378-86, August.
  22. -, 1995. "Economic survey of Puerto Rico, 1994," Oficina de la CEPAL en Washington (Estudios e Investigaciones) 28953, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  23. Anonymous, 1993. "Economic notes," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 56, June.
  24. Sinai, Allen & Stokes, Houston H, 1972. "Real Money Balances: An Omitted Variable from the Production Functions?," The Review of Economics and Statistics, MIT Press, vol. 54(3), pages 290-96, August.
  25. Nourzad, Farrokh, 2002. "Real money balances and production efficiency: a panel-data stochastic production frontier study," Journal of Macroeconomics, Elsevier, vol. 24(1), pages 125-134, March.
  26. Fuerst, Timothy S., 1992. "Liquidity, loanable funds, and real activity," Journal of Monetary Economics, Elsevier, vol. 29(1), pages 3-24, February.
  27. Caglayan, Mustafa & Filiztekin, Alpay, 2003. "Nonlinear impact of inflation on relative price variability," Economics Letters, Elsevier, vol. 79(2), pages 213-218, May.
  28. Dennis, Enid & Smith, V Kerry, 1978. "A Neoclassical Analysis of the Demand for Real Cash Balances by Firms," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 793-813, October.
  29. M. I. Nadiri, 1969. "The Determinants of Real Cash Balances in the U.S. Total Manufacturing Sector," The Quarterly Journal of Economics, Oxford University Press, vol. 83(2), pages 173-196.
  30. Domberger, Simon, 1987. "Relative Price Variability and Inflation: A Disaggregated Analysis," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 547-66, June.
  31. Erdem Basci & Ismail Saglam, 2000. "Optimal Money Growth in A Limited Particpation Model with Heterogenous Agents," Working Papers 0004, Department of Economics, Bilkent University.
  32. N/A, 1982. "Chapter II. The World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 99(1), pages 29-50, February.
  33. N/A, 1982. "Chapter I. The Home Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 99(1), pages 6-28, February.
  34. anonymous, 1982. "New Zealand economic chronology 1981," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 45, january/f.
  35. Anonymous, 1993. "New Zealand economic chronology 1992," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 56, June.
  36. Anonymous, 1993. "Contents of Agricultural Economics, Vol. 8," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 8(4), June.
  37. Fischer, Stanley, 1974. "Money and the Production Function," Economic Inquiry, Western Economic Association International, vol. 12(4), pages 517-33, December.
  38. Barrett, Alan & Lawlor, John, 1995. "The Economics of Solid Waste Management in Ireland," Research Series, Economic and Social Research Institute (ESRI), number PRS26.
  39. N/A, 1982. "Intermediate Targets and Macroeconomic Policy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 99(1), pages 61-67, February.
  40. N/A, 1982. "Chapter I. The Home Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 100(1), pages 32-50, May.
  41. Anonymous, 1982. "The Biologic and Economic Assessment of DBCP," Technical Bulletins 157639, United States Department of Agriculture, Economic Research Service.
  42. N/A, 1982. "Chapter I. the Home Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 102(1), pages 6-26, November.
  43. N/A, 1982. "The Economic Situation," National Institute Economic Review, National Institute of Economic and Social Research, vol. 101(1), pages 3-8, August.
  44. anonymous, 1982. "International economic situation and developments," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 45, august.
  45. Parsley, David C, 1996. "Inflation and Relative Price Variability in the Short and Long Run: New Evidence from the United States," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 28(3), pages 323-41, August.
  46. anonymous, 1982. "Time and economics," Economic Review, Federal Reserve Bank of San Francisco, issue Sum, pages 4-5.
  47. Simos, Evangelos O., 1981. "Real money balances as a productive input : Further evidence," Journal of Monetary Economics, Elsevier, vol. 7(2), pages 207-225.
  48. anonymous, 1995. "Does the bouncing ball lead to economic growth?," Regional Update, Federal Reserve Bank of Atlanta, issue Jul, pages 1-2, 4-6.
  49. Anonymous, 1982. "The Biologic and Economic Assessment of 2, 4, 5-T," Technical Bulletins 157646, United States Department of Agriculture, Economic Research Service.
  50. Jon Harkness, 1984. "Optimal Oil Pricing in a Small Open Economy: A Macro-economic Perspective," Canadian Journal of Economics, Canadian Economics Association, vol. 17(4), pages 762-73, November.
  51. Anonymous, 1995. "March 1995 economic forecasts," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 58, March.
  52. Feenstra, Robert C., 1986. "Functional equivalence between liquidity costs and the utility of money," Journal of Monetary Economics, Elsevier, vol. 17(2), pages 271-291, March.
  53. -, 1995. "Summary of Caribbean Economic Performance," Sede Subregional de la CEPAL para el Caribe (Estudios e Investigaciones) 38909, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  54. anonymous, 1982. "Economic policy measures," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 45, july.
  55. Edward M. Gramlich & Henry J. Aaron & Michael C. Lovell, 1982. "An Econometric Examination of the New Federalism," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 13(2), pages 327-370.
  56. N/A, 1982. "Chapter II. The World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 100(1), pages 51-64, May.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:mes:emfitr:v:43:y:2007:i:1:p:64-73. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Nguyen)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.