Broad money demand and financial liberalization in Malaysia: an application of the nonlinear learning function and error-correction models
This paper attempts to model the effects of financial liberalization and innovations on the demand for broad money in Malaysia. The nonlinear learning function and error-correction mechanism model were utilized. The results of encompassing tests and dynamic (ex post) simulation confirm the error-cor...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Universiti Putra Malaysia Press
2001
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| Online Access: | http://psasir.upm.edu.my/id/eprint/3326/1/Broad_Money_Demand_and_Financial_Liberalization_in_Malaysia.pdf |
| Summary: | This paper attempts to model the effects of financial liberalization and innovations on the demand for broad money in Malaysia. The nonlinear learning function and error-correction mechanism model were utilized. The results of encompassing tests and dynamic (ex post) simulation confirm the error-correction as the parsimonious specification. The augmented error-correction model with nonlinear interacted variables is unable to detect the effects of financial liberalization on Malaysian broad money demand. |
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