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Application of Linear Aegression Model with Symmetric and Assymmetric Fuzzy Coefficients for Money Demand Function in Iran Economy

Author

Listed:
  • Ashraf Ganjoei, Reza

    (PhD student in Economics, Shahid Bahonar University of Kerman)

  • Akbarifard, Hossein

    (Associate Professor of Economics, Shahid Bahonar University of Kerman)

  • Mashinchi, Mashaallah

    (Professor of Statistics, Shahid Bahonar University of Kerman)

Abstract

Considering the role of monetary policy in this paper, using linear regression model with symmetric and assymmetric fuzzy coefficients to analyze the money demand function in Iran economy for the period of 1396- 1375.We also used the Friedman and Chordiy study (1988 and 1996) to justify the model.The results of the estimation show the superior performance of the linear regression model with symmetric and asymmetric fuzzy coefficients. On this basis, it can be stated that in the estimation of the fuzzy regression model with the coefficients, the function of the money demand function is the same for all degrees of membership from 0.1 to 0.9. There is not even a very slight change in the mode value. Which implies keeping money with speculative and precautionary motives and will have a recession-induced monetary effect on the economy. On the other hand, in this regression, changes in the coefficients of elasticity have not resulted in any changes in the value of the objective function (money demand), which indicates the stability of the demand for money in Iran. Since the time period is considered in this long-term study, In terms of membership, 0.8 and 0.9, the demand for money is the highest and lowest, respectively, expressed in terms of liquidity and uncertainty conditions in the economy. Also, the stability of the coefficients of the explanatory variables of money demand in the linear regression model with symmetric and asymmetric fuzzy coefficients in Iran is somewhat consistent with the theoretical model of Sidrauski (1967). In other words, this monetary theory can justify the conditions of the Iran economy

Suggested Citation

  • Ashraf Ganjoei, Reza & Akbarifard, Hossein & Mashinchi, Mashaallah, 2022. "Application of Linear Aegression Model with Symmetric and Assymmetric Fuzzy Coefficients for Money Demand Function in Iran Economy," Quarterly Journal of Applied Theories of Economics, Faculty of Economics, Management and Business, University of Tabriz, vol. 9(1), pages 239-270, June.
    • Handle: RePEc:ris:qjatoe:0263
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    More about this item

    Keywords

    money demand function; fuzzy regression; Symmetric coefficients and asymmetric;
    All these keywords.

    JEL classification:

    • C19 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Other
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts

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