The velocity of money and per capita income in developing economies

Malaysia and Singapore

Bibliographic Data

ID20304129
AuthorsBrock K Short (University of Windsor, corresponding author)
Year1973
Volume9
Issue2
Pages291-300
Publication date1973-01-01
Open AccessNo
TypeARTICLE
VenueThe Journal of Development Studies (JOURNAL)
Journal identifiersISSN: 0022-0388 • E-ISSN: 1743-9140
PublisherInforma UK Limited (PUBLISHER • GB)
DOI10.1080/00220387308421443
OpenAlexW2009796834
LanguageEN
Citations received4
References cited14

If the velocity of money is a negative function of per capita income, the capacity of money creating institutions to finance development increases. However, empirical support for this proposition has been weak. Thus, this paper investigates velocity's behaviour in the economy of West Malaysia and Singapore from 1951 to 1966. Results show velocity to be primarily a positive function of the number of bank offices and a negative function of per capita real GDP. The paper concludes that closer observation of underdeveloped economies in which velocity has paradoxically risen with per capita income, might reveal similar institutional changes which have overwhelmed the inverse relation between per capita income and velocity

Development economics · Economics · Macroeconomics · Monetary economics · Per capita · Per capita income · Population · Sociology · Economic Growth and Productivity · Fiscal Policy and Economic Growth · Monetary Policy and Economic Impact

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