Money Supply and Inflation Dynamics in the Asia-Pacific Economies: A Time-Frequency Approach

12 Pages Posted: 25 Jul 2017 Last revised: 15 Sep 2017

See all articles by Stelios Bekiros

Stelios Bekiros

European University Institute - Economics Department (ECO); IPAG Business School; Athens University of Economics and Business; University of Bologna - Rimini Center for Economic Analysis (RCEA)

Ahmed Taneem Muzaffar

Independent

Gazi Salah Uddin

Linkoping University - Department of Management and Engineering Division

Javier Vidal-García

Harvard University; Complutense University Madrid

Date Written: April 5, 2017

Abstract

We examine the relationship between money supply growth and inflation in 3 Asian Economies which are India, Malaysia and Japan using a time-frequency approach. The application of a unified multi-scale analysis allows us to provide a continuous assessment of the link between money supply growth and inflation, unlike most of the existing literature studying this relationship. We also employ a bivariate frequency-domain causality test to determine the nature and direction of interdependence between money supply growth and inflation dynamics. Our findings provide a better understanding of their lead-lag linkages and causal relationship in the selected countries of the Asia-Pacific region.

Keywords: Monetary Policy, Wavelet Analysis, Nonlinear Causality

JEL Classification: C40, E3, E4, E50

Suggested Citation

Bekiros, Stelios and Muzaffar, Ahmed Taneem and Uddin, Gazi Salah and Vidal-García, Javier, Money Supply and Inflation Dynamics in the Asia-Pacific Economies: A Time-Frequency Approach (April 5, 2017). Studies in Nonlinear Dynamics and Econometrics, Vol. 21, No. 3, Apr 2017. Available at SSRN: https://ssrn.com/abstract=3006823

Stelios Bekiros

European University Institute - Economics Department (ECO) ( email )

Villa San Paolo
Via della Piazzuola 43
50133 Florence
Italy

IPAG Business School ( email )

184 BD Saint Germain
Paris, 75006
France

Athens University of Economics and Business ( email )

76 Patission Street
Athens, 104 34
Greece

University of Bologna - Rimini Center for Economic Analysis (RCEA) ( email )

Via Patara, 3
Rimini (RN), RN 47900
Italy

Ahmed Taneem Muzaffar

Independent ( email )

No Address Available

Gazi Salah Uddin

Linkoping University - Department of Management and Engineering Division ( email )

Linköping, 581 83
Sweden

Javier Vidal-García (Contact Author)

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

Complutense University Madrid ( email )

School of Business Administration
Somosaguas Campus
Madrid, Madrid 28223
Spain

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