AIRESS Research Seminar

Africa Institute for Research in Economics and Social Sciences is organizing a seminar on Friday, February 23rd at 12:30 p.m at the Rabat Campus of Mohammed VI Polytechnic University  on ''Estimation of non-transactional Cash in Morocco''


This working paper focuses on the hoarding issue in Morocco. First, the estimation of cash demand equations for groups of denominations (large and small) highlights the exclusive influence of transactional motives on small denominations, while large denominations are also influenced by non-transactional motives. Then, using three empirical approaches (ratio method, lifespan method, and seasonality method), we estimate the proportion of high-denomination banknotes -100 and 200 dirhams (MAD) - held for non-transactional reasons. The results are consistent with the strong growth of hoarded cash in Morocco since the early 2000s. Non-transactional cash demand stood at around 20% at the start of the millennium, and would fluctuate in 2021 between 60% and 80% of the value of 100 MAD and 200 MAD banknotes in circulation, depending on the assumptions made.