Currency substitution in selected African countries - Emerald

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Currency substitution 627 Figure 1. Impulse response functions – Egypt consider the sample period 1981:1 to 2005:4 using the US dollar as anchor currency, we note that there is no evidence currency substitution between the Ghanaian cedi and the US dollar (see Table III)[12]. 4.1.3 Kenya. The normalized money demand function for Kenya is: 20:992 þ 2:032y t 2 0:0381i t 2 0:398p e t 2 0:078De e t m 2 ¼ ð21:42Þ 3:96 * 23:07 * ð21:93Þ 4:47 * :
JES 36,6 628 Figure 2. Impulse response functions – Ghana We find no evidence of currency substitution between the Kenyan Shilling and the South African Rand. Thus, our findings suggest that the money demand in Kenya is stable. Monetary authorities may therefore efficiently pursue an independent monetary policy. The response of real money demand to a one standard deviation shocks are shown in Figure 3. The response to expected inflation is negative at first up to the 9th quarter where it becomes positive and significant for the remaining of the time period
Page 1 and 2: The current issue and full text arc
Page 3 and 4: JES 36,6 618 with weaker trade ties
Page 5 and 6: JES 36,6 620 3. Model specification
Page 7 and 8: JES 36,6 622 The expected change in
Page 9 and 10: JES 36,6 624 Johansen and Juselius
Page 11: JES 36,6 626 Table IV. Variance dec
Page 15 and 16: JES 36,6 630 40th quarter. Our vari
Page 17 and 18: JES 36,6 632 Figure 5. Impulse resp
Page 19 and 20: JES 36,6 634 expected change in exc
Page 21 and 22: JES 36,6 636 Figure 8. Impulse resp
Page 23 and 24: JES 36,6 638 10. The LR statistics
Page 25: JES 36,6 640 Sharma, S.C., Chaisris

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