Money Demand and Inflation in Dollarized Economies : The Case of Russia /

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 holdin...

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Bibliographic Details
Main Author: Ohnsorge, Franziska
Other Authors: Oomes, Nienke
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2005.
Series:IMF Working Papers; Working Paper ; No. 2005/144
Online Access:Full text available on IMF
Description
Summary: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.
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Physical Description:1 online resource (30 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students