The impact of variations in oil prices on the demand for money in Algeria: an empirical study over the 1980-2019 period

Anissa Atmani, Nacer-Eddine Mouffok

Abstract

The purpose of this article is to examine the possible link that may exist between variations in the price of oil and the demand for money in Algeria. For this, we used an econometric study based on two approaches: linear and nonlinear of the distributed autoregressive delay (ARDL), during a period going from 1980 to 2019. The results show that there is, in both approaches, an impact positive variation in the price of oil on the demand for real money in Algeria. However, this impact is asymmetric in the case of nonlinear ARDL. In addition, we have recorded that any positive change in the price of oil will negatively impact the demand for real money, while this impact would be insignificant when the price of oil changes negatively.