Testing Frankel's Monetary Model in Algeria Evidence from 1995 to 2023

المراحي البشير; بن باير حبيب

Article Details

Testing Frankel's Monetary Model in Algeria Evidence from 1995 to 2023

Authors:

المراحي البشير | بن باير حبيب

Publisher:

Université de Ghardaia

Journal:

مجلة إضافات إقتصادية Vol.9 Issue 2, pp.8-24

Document Type:

Article

Publication Date:

9/2025

Document Language:

English

Document ID (Org No.):

2001575373

pISSN:

2710-7981

Keywords:

Abstract:

 Abstract:
 This paper examines short- and long-term drivers of exchange rate movements using the ARDL model. Drawing on monetary and output-based theories, it includes key variables: relative money supply, income differentials, and interest rate spreads. A stable long-run cointegrating relationship is confirmed. Domestic money expansion depreciates the local currency, while higher domestic income strengthens it. Interest rate differentials show no significant long-term effect but influence short-term fluctuations. The error correction term indicates a rapid return to equilibrium. Short-term dynamics also reflect lagged effects of money supply and income. Results align with uncovered interest parity. Diagnostic tests confirm model stability. The study highlights the need for sound monetary policy and balanced growth to maintain exchange rate stability.

Article Details

Testing Frankel's Monetary Model in Algeria Evidence from 1995 to 2023

Authors:

المراحي البشير | بن باير حبيب

Publisher:

Université de Ghardaia

Journal:

مجلة إضافات إقتصادية Vol.9 Issue 2, pp.8-24

Document Type:

Article

Publication Date:

9/2025

Document Language:

English

Document ID (Org No.):

2001575373

pISSN:

2710-7981

Exchange Rate

Monetary Fundamentals

Interest Rate

ARDL

Algeria

Issues

Article Details

Testing Frankel's Monetary Model in Algeria Evidence from 1995 to 2023

Authors: المراحي البشير | بن باير حبيب

Publisher: Université de Ghardaia

Journal: مجلة إضافات إقتصادية Vol.9 Issue 2, pp.8-24

Document Type: Article

Publication Date: 9/2025

Document Language: English

Document ID (Org No.): 2001575373

pISSN: 2710-7981

Exchange Rate

Monetary Fundamentals

Interest Rate

ARDL

Algeria

Issues

Authors:

المراحي البشير | بن باير حبيب

Publisher:

Université de Ghardaia

Journal:

مجلة إضافات إقتصادية Vol.9 Issue 2, pp.8-24

Document Type:

Article

Publication Date:

9/2025

Document Language:

English

Document ID (Org No.):

2001575373

pISSN:

2710-7981