On the Stability of Money Demand in Ghana: A Bounds Testing Approach

19 Pages Posted: 20 Dec 2011

See all articles by Jihad C. Dagher

Jihad C. Dagher

International Monetary Fund (IMF) - Research Department

Arto Kovanen

International Monetary Fund (IMF) - African Department

Date Written: November 2011

Abstract

This paper adopts the bounds testing procedure developed by Pesaran et al. (2001) to test the stability of the long-run money demand for Ghana. The results provide strong evidence for the presence of a stable, well-identified long-run money demand during a period of substantial changes in the financial markets. The empirical evidence points to complex dynamics between money demand and its determinants while suggesting that deviations from the equilibrium are rather short-lived.

Keywords: Capital markets, Demand for money, Inflation targeting, Monetary policy

Suggested Citation

Dagher, Jihad C. and Kovanen, Arto, On the Stability of Money Demand in Ghana: A Bounds Testing Approach (November 2011). IMF Working Paper No. 11/273, Available at SSRN: https://ssrn.com/abstract=1974841

Jihad C. Dagher (Contact Author)

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States

Arto Kovanen

International Monetary Fund (IMF) - African Department ( email )

1700 19th Street, NW
Washington, DC 20431
United States

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