Survey of Literature on Demand for Money: Theoretical and Empirical Work with Special Reference to Error-Correction Models

77 Pages Posted: 13 Feb 2006

Date Written: May 1999

Abstract

A stable money demand forms the cornerstone in formulating and conducting monetary policy. Consequently, numerous theoretical and empirical studies have been conducted in both industrial and developing countries to evaluate the determinants and the stability of the money demand function. This paper briefly reviews the theoretical work, tracing the contributions of several researchers beginning from the classical economists, and explains relevant empirical issues in modeling and estimating money demand functions. Notably, it summarizes the salient features of a number of recent studies that applied cointegration/error-correction models in the 1990s, and it features a bibliography to aid in research on demand for money.

Keywords: money demand, literature survey, cointegration, error-correction models

JEL Classification: E41

Suggested Citation

Sriram, Subramanian, Survey of Literature on Demand for Money: Theoretical and Empirical Work with Special Reference to Error-Correction Models (May 1999). IMF Working Paper No. 99/64, Available at SSRN: https://ssrn.com/abstract=880591

Subramanian Sriram (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
897
Abstract Views
2,979
rank
30,294
PlumX Metrics