2017, Volume 70 - Issue 1
RSS feed citation: At RePEc
Publication date: 01 February 2017
THE RELATIONSHIP BETWEEN SAVINGS AND ECONOMIC GROWTH AT THE DISAGGREGATED LEVELRead the article
MONETARY POLICY TRANSMISSION OVER THE REAL SECTOR OF BANGLADESH ECONOMY: AN SVAR APPROACHRead the article
REMITTANCES AND FOREIGN AID AS SOURCES OF EXTERNAL DEVELOPMENT FINANCE: IMPACTS ON SAVINGS AND INVESTMENT IN POST-WAR LEBANONRead the article
THE DYNAMIC CAUSAL LINKAGE BETWEEN FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH: EMPIRICAL EVIDENCE FROM ETHIOPIARead the article
Abdur Rahman FORHAD, Northern Illinois University, DeKalb, Illinois, USA
Ghassem A. HOMAIFAR, Middle Tennessee State University, Murfreesboro, Tennessee, USA
Abul Hasnat Muhammed SALIMULLAH, Middle Tennessee State University, Murfreesboro, Tennessee, USA
This study examines the effectiveness of the monetary policy transmission of Bangladesh using Structural Vector Autoregressive model (SVAR) for the period of 1972-2014. The SVAR model investigates how a monetary policy shock defined as an unexpected rise in interest rate affects real and nominal macro variables; namely real output, prices, real effective exchange rates, and money supply. Our results suggest that a monetary policy shock does have a short run effect on real output, price level, and exchange rates. A monetary policy shock generates inflationary pressure leading to a devaluation of the Bangladeshi Taka. This paper suggests that the policy makers, to consider the trade-off between output and interest rate of Bangladesh.
Bangladesh, Monetary Policy, SVAR
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