Mobile Money and Money Demand in Kenya

Elizabeth Kasekende and Eftychia Nikolaidou
Additional contact information
Elizabeth Kasekende: Bank of Uganda

No 2018-11, School of Economics Macroeconomic Discussion Paper Series from School of Economics, University of Cape Town

Abstract: Over the years, several countries have experienced a variety of financial innovations that can have implications for monetary policy. Kenya has been at the forefront of a unique type of financial innovation, mobile money (M-PESA), introduced in 2007. This paper re-estimates the Kenyan money demand including the country specific innovation, mobile money, using the ARDL approach to cointegration over the period 2000 Q1 to 2014 Q2. The results suggest that there is a positive relationship between mobile money and money demand and that the Kenyan demand for money is stable when mobile money is taken into consideration. These results are robust even with the use of alternative measures of mobile money. This finding has important implications for the effectiveness of monetary policy in Kenya and possibly in other countries that have seen developments in mobile money in recent years.

Date: 2018
New Economics Papers: this item is included in nep-afr, nep-mon and nep-pay
References: Add references at CitEc
Citations:

Downloads: (external link)
https://docs.google.com/viewer?a=v&pid=sites&srcid ... MmM5NDYyNGM1NzgwZDlm Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ctn:dpaper:2018-11

Access Statistics for this paper

More papers in School of Economics Macroeconomic Discussion Paper Series from School of Economics, University of Cape Town Contact information at EDIRC.
Bibliographic data for series maintained by Kevin Kotze ().