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Dynamic Analysis of Money Demand Function: Case of Turkey

Author

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  • doğru, bülent
Abstract
In this paper, the dynamic determinants of money demand function and the long-run and short-run relationships between money demand, income and nominal interest rates are examined in Turkey for the time period 1980-2012. In particular we estimate a dynamic specification of a log money demand function based on Keynesian liquidity preference theory to ascertain the relevant elasticity of money demand. The empirical results of the study show that in Turkey inflation, exchange rate and money demand are co-integrated, i.e., they converge to a long run equilibrium point, and money demand function in Turkey.

Suggested Citation

  • doğru, bülent, 2013. "Dynamic Analysis of Money Demand Function: Case of Turkey," MPRA Paper 48402, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:48402
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    References listed on IDEAS

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    Cited by:

    1. Yutaka Kurihara, 2015. "The Demand for Money: Recent Japanese Case," Economy, Asian Online Journal Publishing Group, vol. 2(1), pages 10-15.
    2. Emel Siklar & Ilyas Siklar, 2021. "Is There a Change in the Money Demand Stability in Turkey? A Nonlinear Approach," International Journal of Economics and Financial Research, Academic Research Publishing Group, vol. 7(2), pages 28-42, 06-2021.

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    More about this item

    Keywords

    Dynamic Ordinary Least Squares; Vector Error Correction; Money Demand Function;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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