A direct test of the endogeneity of money: Implications for Gulf Cooperation Council (GCC) countries

Bedri Kamil Onur Tas*, Selahattin Togay

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

8 Citations (Scopus)


This paper contributes to the ongoing discussion about the endogeneity of money supply by empirically investigating the GCC countries. We propose and implement a direct test of money supply endogeneity that depends on econometric specification of exogeneity which has not been used in the literature before. To be able to make comparisons with previous studies, we also conducted Granger Causality tests to analyze the causality relationship between bank credit and money supply. Both of the empirical studies provide empirical evidence for the endogeneity of money supply in GCC countries. The results of the paper have many significant monetary policy implications for the upcoming monetary unification of the GCC countries.

Original languageEnglish
Pages (from-to)577-585
Number of pages9
JournalEconomic Modelling
Issue number3
Publication statusPublished - May 2012
Externally publishedYes


  • Endogenous money supply
  • GCC Countries
  • Monetary union
  • Post Keynesian monetary theory

ASJC Scopus subject areas

  • Economics and Econometrics

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