| Title: | Interest-Free and Interest-Bearing Money Demand: Policy Invariance and Stability |
| Number: | 01-07 |
| Author: | Amir Kia |
| Issue Date: | August 2001 |
| Abstract: | This paper, using quarterly Iranian data for the period of 1966-1998,
extends
the literature by investigating the stability of the interest-free money demand function. The study also examines the stability of economic agents' behavior in demanding interest-bearing and interest-free money. It was found, contrary to interest-bearing demand for money, both short- and long-run demand for interest-free money functions are stable and their coefficients are invariant with respect to policy and other exogenous shocks as well as changes in regime. |
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