Money demand and currency and asset substitucion in Venezuela: 1997-2008

Alberto Gregorio Castellano Montiel ()
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Alberto Gregorio Castellano Montiel: Investigador del Instituto de Investigaciones de la Facultad de Ciencias Económicas y Sociales. Universidad del Zulia, Ciudad Universitaria “Dr Antonio Borjas Romero”, Núcleo Humanístico. Avenida Goajira. Sector Ziruma, Maracaibo, Venezuela. Apartado Postal 526.

Economía, 2012, vol. 37, issue 34, 89-120

Abstract: This study aims to estimate, using quarterly data, a money demand function for Venezuela with the phenomena of currency substitution (CS) and asset substitution (AS) during the period 1997(1)-2008(4). This model is based on the one proposed by Cuddington (1983) and modified by Mizel and Pentecost (1994). The empirical evidence shows that during the period the phenomenon of dollarization is present. There has been a change in the functions of money as a store of value (AS) and as a medium of exchange (CS) when M2 is used. In aggregates more liquid (M1) dollarization is observed only for currency substitution.

Keywords: Dollarization; demand for money; currency substitution; asset substitution. (search for similar items in EconPapers)
JEL-codes: C32 E41 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:ula:econom:v:37:y:2012:i:34:p:89-120

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