On stability of the demand for money in a developing OECD country: the case of Turkey
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Halicioglu, Ferda and Ugur, Mehmet (2005) On stability of the demand for money in a developing OECD country: the case of Turkey. Global Business and Economics Review, 7 (2/3). pp. 203-213. ISSN 1097-4954 (print) 1745-1329 (online)
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Abstract
This paper empirically analyses the stability of the narrow money demand function (M1) in Turkey for the period 1950–2002. As part of the IMF sponsored stabilisation programme, Turkey has been pursuing base money targets. To ascertain whether this policy framework satisfies the necessary condition for effectiveness, we estimate and test for the stability of Turkish M1 by employing a recent single cointegration procedure proposed by Pesaran et al. (2001) along with the CUSUM and CUSUMSQ stability tests. We demonstrate that there is a stable money demand function and it could be used as an intermediate target of monetary policy in Turkey.
| Item Type: | Article |
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| Additional Information: | The final, definitive version of this paper has been published in Global Business and Economics Review, Vol. 7/ No. 2/3, 2004 by Inderscience Publishers. |
| Uncontrolled Keywords: | cointegration, money demand, stability, Turkey, base money targets, monetary policy |
| Subjects: | H Social Sciences > HC Economic History and Conditions J Political Science > JN Political institutions (Europe) |
| School / Department / Research Groups: | School of Business School of Business > Department of International Business & Economics |
| Related URLs: | |
| Last Modified: | 31 Mar 2011 18:21 |
| URI: | http://gala.gre.ac.uk/id/eprint/3978 |
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