On the Asymmetric Effects of Exchange Rate Changes on the Demand for Money: Evidence from Emerging Economies
Mohsen Bahmani-Oskooee (),
Ali Kutan () and
Journal of Emerging Market Finance, 2019, vol. 18, issue 1, 1-22
Previous studies, that included the exchange rate in the demand for money function to account for currency substitution, assumed that exchange rate changes have symmetric effects on the demand for money in emerging countries. Since assuming symmetric effects implies using a linear model, they were not successful in finding significant link between the exchange rate movements and the demand for money. When we applied a nonlinear model to address the same issue, we found that in most emerging economies in our sample, exchange rate changes do have significant long-run effects on the demand for money and such effects are indeed asymmetric. JEL Classifications: E41, F31
Keywords: Money demand; exchange rate; nonlinear model; asymmetry; emerging; countries (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:sae:emffin:v:18:y:2019:i:1:p:1-22
Access Statistics for this article
More articles in Journal of Emerging Market Finance from Institute for Financial Management and Research
Bibliographic data for series maintained by SAGE Publications ().