The Impact of Banking Crises on Money Demand and Price Stability
The author empirically investigates the
monetary impact of banking crises in Colombia, Chile,
Denmark, Japan, Kenya, Malaysia, and Uruguay. She uses
co-integration analysis and error correction modeling to
research: 1) Whether money demand stability is threatened by
banking crises. 2) Whether crises bring about structural
breaks in the relationship between monetary indicators and
prices. Overall, she finds no systematic evidence that
banking crises cause money demand instability. Nor do the
results consistently support the notion that the
relationship between monetary indicators and prices
undergoes structural breaks during crises. However, although
individual coefficients in price equations do not seem to be
severely affected by crises, crises can sometimes give rise
to variance instability in price or inflation equations.
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Bibliographic Details
| Main Author: |
Martinez Peria, Maria Soledad |
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| Format: | Working Paper
biblioteca
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| Language: | English
en_US |
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| Published: |
World Bank, Washington, DC
2000-03
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| Subjects: | BANKING CRISES,
CAPITAL MARKETS,
CENTRAL BANK,
CENTRAL BANKS,
CURRENCY,
DEMAND FOR MONEY,
DEREGULATION,
DEUTSCHE MARK,
DEVELOPED COUNTRIES,
ECONOMIC THEORY,
ELASTICITIES,
ELASTICITY,
EMPIRICAL ANALYSIS,
EMPIRICAL EVIDENCE,
ENDOGENOUS VARIABLES,
EQUATIONS,
EQUILIBRIUM,
EXCHANGE RATE,
EXCHANGE RATE CHANGES,
EXCHANGE RATES,
FINANCIAL INNOVATION,
GOVERNMENT BONDS,
GROWTH RATE,
INCOME,
INFLATION,
INFLATION RATE,
INTEREST RATE,
INTEREST RATES,
LABOR MARKETS,
M2,
MONETARY AGGREGATES,
MONETARY AUTHORITIES,
MONETARY INDICATORS,
MONETARY POLICY,
MONEY DEMAND,
MONEY DEMAND FUNCTIONS,
MONEY DEMAND STABILITY,
MULTIPLIERS,
OUTPUT,
PRICE INFLATION,
PRICE STABILITY,
PURCHASING POWER,
PURCHASING POWER PARITY,
REAL WAGES,
STOCK PRICES,
T-BILLS,
UNEMPLOYMENT,
UNEMPLOYMENT RATE,
VOLATILITY,
WAGES, |
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| Online Access: | http://documents.worldbank.org/curated/en/2000/03/437908/impact-banking-crises-money-demand-price-stability
https://hdl.handle.net/10986/22356
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