Money Demand and Inflation in Dollarized Economies: The Case of Russia
Posted: 23 Sep 2005
There are 2 versions of this paper
Money Demand and Inflation in Dollarized Economies: The Case of Russia
IMF Working Paper No. 05/144
Number of pages: 31
Posted: 03 Mar 2006
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227
Date Written: July 2005
Abstract
Money demand in dollarized economies often appears to be highly unstable, making it difficult to forecast and control inflation. In this paper, we show that a stable money demand function for Russia can be found for "effective broad money," which includes an estimate of foreign cash holdings. Moreover, we find that an excess supply of effective broad money is inflationary, while other excess money measures are not, and that effective broad money growth has the strongest and most persistent effect on short-run inflation.
Suggested Citation: Suggested Citation
Oomes, Nienke and Ohnsorge, Franziska, Money Demand and Inflation in Dollarized Economies: The Case of Russia (July 2005). IMF Working Paper No. WP/05/144, Available at SSRN: https://ssrn.com/abstract=807584
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