skip to contents.

Research Activities

Research Projects

FY 2006/2007 Research Topic: 4-18
Financial Markets and Money in Developing Countries


Money serves as a medium of exchange as well as to store value. The market economy can fully function only if money, the unit of account, plays its roles properly. On the other hand, money is created by the provision of credit by banks. Central banks change the quantity of money in the financial markets. These changes in the quantity of money have non-neutral effects on real economic activities through institutional factors such as wage-price rigidities.

In developing countries, which are transforming themselves towards the market economy by liberalization policies in goods and financial markets, a stable relationship between price and money has been destabilized together with the rapid accumulation of financial assets. On the other hand, rapid credit growth amplifies business cycles. Central banks in developing countries face the challenges described above. This research project mainly aims to gain a theoretical and empirical understanding of the problems in developing countries as represented above.


April 2006 - March 2008


Members of the Research Project

MITSUO Hisayuki
Hidehiko ISHIHARA (Associate Professor, Senshu University)
Masanaga KUMAKURA (Associate Professor, Osaka City University)
Masaaki KOMATSU (Professor, Hiroshima University)
Kaku FURUYA (Associate Professor, Daito Bunka University)


  • The results of the study will be submitted to Developing Economies in 2007.