SOME EMPIRICAL EVIDENCE ON THE QUANTITY THEORETIC PROPOSITION OF MONEY IN ASEAN-5

The study examines the international evidence on the long-run neutrality (LRN) of money based on low frequency data from five emerging ASEAN economies. namely. Indonesia, Malaysia, the Philippines, Singapore, and Thailand. using a nonstructural reduced-form bivariate ARIMA model proposed by Fisher and Seater (1993). Empirical evidence shows that the classical proposition cannot be rejected with respect to real export, except for Thailand. However, with respect to real output. the LRN test results arc not robust to changes in money supply in countries under study. The narrow monetary aggregate seems to have greater impact on economic activities in Indonesia. Malaysia and Thailand, as compared to the other two countries.