Money demand in China: A banking approach

Zhou, Peng ORCID: https://orcid.org/0000-0002-4310-9474 2016. Money demand in China: A banking approach. International Journal of Economics & Management Sciences 5 (6) , 1000381. 10.4172/2162-6359.1000381

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Abstract

Traditional money demand function is based on partial equilibrium model, which only focuses on the liquidity market. Though working quite well in practice, the empirical results of these models are not robust due to probable misspecifications and omission of important factors. This paper employs the latest development in general equilibrium model, especially banking approach, as the theoretical methodology. This new approach emphasizes the more and more significant role of banking sector in a developing monetary economy like China. It is shown that this model behaves better in theoretical plausibility and empirical robustness. On the other hand, this paper also uses various advanced time series econometrics as the empirical methodology to improve the power of estimations and statistical tests.

Item Type:	Article
Date Type:	Published Online
Status:	Published
Schools:	Business (Including Economics)
Uncontrolled Keywords:	Money demand; General equilibrium; Banking; Time series; China
Publisher:	World Academy of Science, Engineering and Technology
ISSN:	2162-6359
Date of First Compliant Deposit:	16 December 2016
Date of Acceptance:	17 November 2016
Last Modified:	05 May 2023 17:54
URI:	https://orca.cardiff.ac.uk/id/eprint/96960

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