Mobile money: the savior for developing
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2021-07-23
Language
en
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Abstract
Mobile money is a widely used financial service in Kenya. Nowhere else does mobile money have
such an impact in a country. However, the impact of mobile money on key economic indicators is still
an underexplored topic. This study tries to find out if mobile money affects monetary and financial
stability in Kenya. To answer this question, two regression analyses were performed. A multiple OLSregression
was used to answer the question of the effect on financial stability. The results of this
research indicate that mobile money has no effect on financial stability in Kenya. On the other hand,
an OLS- and VEC model answered the question of the effect on monetary stability. The results of this
regression analyses indicate that mobile money has a positive relationship with real money demand in
Kenya. This modifies the functioning of the monetary policy, which has a negative impact on
monetary stability. It will therefore be reasonable for countries where mobile money is already widely
represented, to include these effects of mobile money in their future policy design. Otherwise, their
policies will not achieve their desired goals. A possible follow-up study could focus on another
country or on the influence of the time period.
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Faculteit der Managementwetenschappen