How stable is the demand for money in African countries?Mohsen Bahmani-Oskooee and Abera Gelan Journal of Economic Studies, 2009, vol. 36, issue 3, pages 216-235 Abstract: Purpose – Studies that have addressed the stability of the demand for money in African countries are rare. A few papers have addressed the issue in a small number of individual countries. For cross-country comparison, this paper aims to investigate the stability of the M2 demand for money in 21 African countries using quarterly data over the period 1971Q1-2004Q3. Design/methodology/approach – A standard money demand function is designed. It is estimated using a bounds testing approach to co-integration and error-correction modeling. Findings – Application of the CUSUM and CUSUMSQ tests to the residuals of error-correction models reveals that in almost all 21 countries, M2 demand for money is stable. This could be due to incorporating the short-run adjustment process in testing for the stability of the long-run elasticity estimates. Research limitations/implications – Due to data limitations, the study could not be extended to all countries in Africa. Originality/value – This is the most comprehensive study in the literature for Africa. Keywords: Africa; Demand; Money (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:eme:jespps:v:36:y:2009:i:3:p:216-235 Ordering information: This journal article can be ordered from Access Statistics for this article Journal of Economic Studies is edited by Professor Mohsen Bahmani-Oskooee More articles in Journal of Economic Studies from Emerald Group Publishing |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
Swedish Business School at Örebro University.