The Servey of Liquidity Demand in Iran’s Economy
Volume 9, Issue 32, Spring 2009, Pages 147-166
Mahmood Daneshvar Kakhki, Siavash Dehghanian, Ali Firooz Zarea
Abstract Estimating liquidity demand function considered as an instrument of designing effective policies on money balance. Based on different lookouts, economists represent different models. By using Iran´s time series data of 1974-2001, this study have estimated long-run relationship of money demand; moreover, this have tried to investigate effects of short-run shocks on money demand. Results depicted that income, oil incomes, exchange rate and interest rate influence on money demand in short-run; furthermore, there is a long-run relationship between these variables and money demand. Also, on condition that a shock comes to across to money demand, only twenty six percent of this shock will be adjusted.