University of Bahrain
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Money Demand Determinants and Stability in Yemen: An ARDL Approach to Cointegration

Show simple item record Alhannom, Essa 2018-08-01T05:45:13Z 2018-08-01T05:45:13Z 2016-07
dc.identifier.issn 2384-4663
dc.description.abstract This paper investigates the determinants and stability of narrow and broad real money demand functions in Yemen. The ARDL bounds testing approach to cointegration and error correction modeling were applied to quarterly data covering the period from 2001Q1 to 2013Q4. The empirical results suggest the existence of long-run relationships between real money balances (M1 and M2), and their determinants including real income, inflation rate, and exchange rate. The elasticity coefficients of the real income and inflation rate bear the predicted positive and negative signs respectively and found to be statistically significant. The dominance of the currency substitution effect is reflected in the negative sign of the elasticity coefficient of exchange rate. In addition, CUSUM and CUSUMSQ tests support the stability of both M1 and M2 models during the estimation period. en_US
dc.language.iso en en_US
dc.publisher University of Bahrain en_US
dc.rights Attribution-NonCommercial-ShareAlike 4.0 International *
dc.rights.uri *
dc.subject Money demand
dc.subject cointegration
dc.subject bounds testing
dc.subject Yemen
dc.title Money Demand Determinants and Stability in Yemen: An ARDL Approach to Cointegration en_US
dc.type Article en_US
dc.volume 03
dc.issue 02
dc.pagestart 71
dc.pageend 78
dc.source.title International Journal of Business and Statistical Analysis
dc.abbreviatedsourcetitle IJBSA

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