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Are The Determinants Of Money Demand Stable In Selected Countries From Southeastern Europe?

Author

Listed:
  • Jordan KJOSEVSKI

    (Moneymax Financial, Ohrid Republic of Macedonia.)

  • Mihail PETKOVSKI

    (Financial Management, Faculty of Economics, Ss Cyril and Methodius University in Skopje, Republic of Macedonia)

Abstract
The purpose of this article is to examine the long and short-run determinants of money demand (M1) and their stability in the seven Southeast European (SEE) countries using monthly data from January 2005 to December 2014. The Pool Mean Group Estimation of ARDL was used to find the long-run and short-run dynamic relationships in money demand model. Empirical results provide the evidence that index of industrial production, exchange rate and dummy variable of effect of the European debt crisis explain the most variations of money demand in the long-run, while exchange rate is significant only in short-run. Our findings also show that real money demand in the SEE countries, despite their turbulent transition from socialist to market economy, was relatively stable in the analyzed period.

Suggested Citation

  • Jordan KJOSEVSKI & Mihail PETKOVSKI, 2017. "Are The Determinants Of Money Demand Stable In Selected Countries From Southeastern Europe?," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 84-96, December.
    • Handle: RePEc:rjr:romjef:v::y:2017:i:4:p:84-96
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    References listed on IDEAS

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    More about this item

    Keywords

    money demand; determinants; Southeast Europe; panel ARDL;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money

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