The Determinants and Stability of Real Money Demand in Vietnam, 1999-2009
Understanding the money demand function is highly important for monetary policy implementation, especially in a monetary targeting framework. The paper uses cointegration analysis and a reduced-form short-run error correction model to investigate the demand for money in Vietnam between 1999 and 2009. We find evidence for a cointegrating relationship between the real money demand, income, the foreign interest rate, and the real stock price. More importantly, statistical tests show that real money demand in Vietnam is stable in this period.
|Date of creation:||Sep 2010|
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Web page: http://www.grips.ac.jp/r-center/en/discussion_papers/
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- Gillman, Max & Cziráky, Dario, 2005.
"Money Demand in an EU Accession Country: A VECM Study of Croatia,"
Cardiff Economics Working Papers
E2005/7, Cardiff University, Cardiff Business School, Economics Section.
- Dario Cziráky & Max Gillman, 2006. "Money Demand in an EU Accession Country: A VECM Study of Croatia," Bulletin of Economic Research, Wiley Blackwell, vol. 58(2), pages 105-127, 04.
- Daniel L. Thornton, 1983. "Why does velocity matter?," Review, Federal Reserve Bank of St. Louis, issue Dec, pages 5-13.
- Qayyum, Abdul, 2005.
"Modelling the Demand for Money in Pakistan,"
2057, University Library of Munich, Germany, revised 2005.
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