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The analysis of money demand for Uganda (1986:1-2003:4)

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  • Nabiddo, Winnie

Abstract

The paper presents an empirical analysis of money demand in Uganda over the period 1986:1-2003:4. Two definition of money were used and tests for co-integration between the monetary aggregates and real money balance were carried out. The empirical results show that income is positively related to money demand while exchange rate, inflation and interest rates have a negative impact on money demand and there is a degree of substitution from non-interest to interest bearing financial assets and holding of foreign currency. the money demand functions remained stables for the entire period, as confirmed by the chow tests.

Suggested Citation

  • Nabiddo, Winnie, 2007. "The analysis of money demand for Uganda (1986:1-2003:4)," Occasional Papers 54936, Economic Policy Research Centre (EPRC).
  • Handle: RePEc:ags:eprcop:54936
    DOI: 10.22004/ag.econ.54936
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    References listed on IDEAS

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    1. Obstfeld, Maurice & Rogoff, Kenneth, 1995. "Exchange Rate Dynamics Redux," Journal of Political Economy, University of Chicago Press, vol. 103(3), pages 624-660, June.
    2. Domowitz, Ian & Elbadawi, Ibrahim, 1987. "An error-correction approach to money demand : The case of Sudan," Journal of Development Economics, Elsevier, vol. 26(2), pages 257-275, August.
    3. Granger, C. W. J., 1981. "Some properties of time series data and their use in econometric model specification," Journal of Econometrics, Elsevier, vol. 16(1), pages 121-130, May.
    4. Mr. Jean-Claude Nachega, 2001. "Financial Liberalization, Money Demand, and Inflation in Uganda," IMF Working Papers 2001/118, International Monetary Fund.
    5. Kevin S. Nell, 1999. "The Stability of Money Demand in South Africa, 1965-1997," Studies in Economics 9905, School of Economics, University of Kent.
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