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Financial liberalization and money demand in the ASEAN countries
Author(s) -
Dekle Robert,
Pradhan Mahmood
Publication year - 1999
Publication title -
international journal of finance and economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.505
H-Index - 39
eISSN - 1099-1158
pISSN - 1076-9307
DOI - 10.1002/(sici)1099-1158(199907)4:3<205::aid-ijfe107>3.0.co;2-g
Subject(s) - economics , liberalization , demand for money , monetary economics , monetary policy , cointegration , macroeconomics , demand deposit , endogenous money , international economics , econometrics , market economy
We estimate long‐run money demand equations for the ASEAN‐4 countries (Indonesia, Malaysia, Singapore, and Thailand) and evaluate whether the equations are cointegrated. Despite the substantial financial liberalization that has taken place in these countries, we find that the money demand equations are cointegrated. In sum, our results show that provided that the monetary authorities know the shape of these money demand equations, a policy framework aimed around monetary targets can be implemented. Copyright © 1999 John Wiley & Sons, Ltd.