IDEAS home Printed from https://ideas.repec.org/p/sko/wpaper/bep-2015-06.html
   My bibliography  Save this paper

Real or nominal shock – which one does more to destabilize developing economies? The case of money velocity in Kazakhstan

Author

Listed:
  • Murat Alikhanov
  • Leon Taylor

    (KIMEP University, Almaty, Kazakhstan)

Abstract

Volatility in money velocity destabilizes spending and output, generating business cycles. This note develops a gauge of this volatility, based on the quantity equation of exchange. In contrast to ad hoc regression, the gauge measures the impacts on volatility of the three determinants of velocity – money supply, output, and the price level. The algorithm allows covariances among these variables. An application to a fast-growing transition economy, Kazakhstan, finds that at the margin, price shocks affect volatility more than do real shocks, by several orders of magnitude. An oil exporter, Kazakhstan may be vulnerable to the gyrating price of crude.

Suggested Citation

  • Murat Alikhanov & Leon Taylor, 2015. "Real or nominal shock – which one does more to destabilize developing economies? The case of money velocity in Kazakhstan," Bulgarian Economic Papers bep-2015-06, Faculty of Economics and Business Administration, Sofia University St Kliment Ohridski - Bulgaria // Center for Economic Theories and Policies at Sofia University St Kliment Ohridski, revised May 2015.
  • Handle: RePEc:sko:wpaper:bep-2015-06
    as

    Download full text from publisher

    File URL: https://www.uni-sofia.bg/index.php/eng/content/download/140408/1028118/file/BEP-2015-06.pdf
    File Function: First version, 2015
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Elwasila Saeed Elamin Mohamed, 2020. "Velocity of Money Income and Economic Growth in Sudan: Cointegration and Error Correction Analysis," International Journal of Economics and Financial Issues, Econjournals, vol. 10(2), pages 87-98.

    More about this item

    Keywords

    real shocks; monetary shocks; monetary policy; simulations; forecasting in transitional economies;
    All these keywords.

    JEL classification:

    • E47 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Forecasting and Simulation: Models and Applications
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sko:wpaper:bep-2015-06. 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: . General contact details of provider: https://edirc.repec.org/data/fesofbg.html .

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Prof. Teodor Sedlarski (email available below). General contact details of provider: https://edirc.repec.org/data/fesofbg.html .

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.