Financial Stability, Monetary Policy, and Economic Growth: Panel Data Evidence from Developed and Developing Countries

Younsi, Moheddine; Nafla, Amine

doi:10.1007/s13132-017-0453-5

Cited by 31 publications

(23 citation statements)

References 22 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In a comprehensive research, Obadeyi, Okhiria, and Afolabi (2016) found the negative effect of monetary policy on economic growth. The result of Younsi and Nafla (2019) by studying 40 developing and developed nations corroborates the conclusion attained by Obadeyi et al (2016). Further, the research findings of Mallick (2011), Precious andMakhetha-Kosi (2014), Lut and Moolio (2015), Njimanted, Akume, and Mukete (2016), and Srithilat and Sun (2017) are also in support of the negative effect of monetary policy on economic growth.…”

Section: Introductionsupporting

confidence: 89%

Modelling the monetary policy transmission on the manufacturing output: Evidence from the fastest growing Indian economy

Sankaran

Arjun

Vadivel³

2020

Journal of Public Affairs

View full text Add to dashboard Cite

The existing literature portrays that the instruments of monetary policy, such as interest rate, money supply, and price have a direct bearing on economic growth and social welfare. Against this background, the present study investigates the monetary policy transmission on manufacturing output in one of the fastest‐growing economies—India. Highlighting how the Central Bank works in a political–economic context, the precise research question used entails—how does monetary policy affect the manufacturing output in India? And what is the transmission channel and level of magnitude? To address these questions, we employed autoregressive distributed lag bounds testing for co‐integration on the time series data collected from World Development Indicators and International Finance Statistics for the period from 1980 to 2018. The model estimation affirms the presence of a co‐integrating relationship among the variables. In the short run, we have a mixed result of relationship among determining variables and manufacturing output, while in the long run, the lending rate has positive and the exchange rate has significant relationships among the variables. The variables such as consumption and gross capital formation have insignificant influence even though negative. The causality test reveals unidirectional short‐run causality stemming from lending rate to industrial output testifying lending rate‐driven growth. In a nutshell, the lending rate has long‐term positive relationship with that of industrial output, and the functional independence of the Central Bank has long‐term consequences on output and this requires a right chord of balance to be struck between political motives and the RBI's autonomy.

show abstract

Section: Introductionsupporting

confidence: 89%

Modelling the monetary policy transmission on the manufacturing output: Evidence from the fastest growing Indian economy

Sankaran

Arjun

Vadivel³

2020

Journal of Public Affairs

View full text Add to dashboard Cite

show abstract

“…Although the concept of monopolistic competition was first presented in [15]. One of the most common models of this class is the Salop model [3], in which the differentiation between products is based on transport costs, they mean some generalized (aggregated) costs borne by the bank's client (depositor) when accessing its services.…”

Section: Resultsmentioning

confidence: 99%

“…The importance of this question, first of all, is explained by the fact that the attribution to the outputs of those factors that are not such, leads to the inevitable distortion of the true goals of the modeled object. To investigate this problem, the approach to solving classification problems, which is proposed in [15], is interesting. It introduces the term costs of using financial resources, which means net costs.…”

Section: Resultsmentioning

confidence: 99%

See 1 more Smart Citation

Modeling the Behavior of Banks in Instability Conditions

Burtnyak

Malytska

2021

jpnu

View full text Add to dashboard Cite

The analysis of models of activity of banking structures in the conditions of perfect and imperfect competition is carried out. Production functions for financial companies are considered. Models of the bank's work as an institution of delegated monitoring are described. Models of dynamics of financial resources are analyzed, allow to describe processes of evolution of own capital of bank depending on dynamics of the involved resources and the policy of accumulation realized by it. The considered models and methods are based on the definition of a bank (a financial company) as some abstract object, which is characterized by input and output parameters, as well as the function that connects them. This approach to some extent allows adapting traditional models of research of industrial enterprises and organizations to the analysis of the activities of banking structures. Therefore, one of the main tasks is to optimize internal functioning. Under such conditions, it is especially important to consider the bank as a holistic complex dynamic system operating in an unstable transition economy and the use of economic and mathematical methods and models to study the processes taking place in the bank, assess its effectiveness, identify areas and ways to improve management banking activities. Based on the analysis of the main economic and mathematical models of behavior of financial companies in a monopolistic market, we can conclude that each model characterizes a certain aspect of financial market development by the situation. Production functions for a bank (financial firm) are built, where the problem of classification of these factors into input and output is significant. A wide class of economic and mathematical models is considered, in which the activity of financial and banking institutions is treated as financial intermediaries. The theory of delegated monitoring is generalized, which in the general case assumes that in conditions when there is an effect of the growth of income from scale, individual lenders prefer to delegate functions of control (monitoring) of the behavior of entrepreneurs in whose projects they have invested to special intermediary firms. banks. The analysis of the development of the banking sector of Ukraine showed that a further gradual slowdown in its pace is expected due to changes in conditions in global financial markets and market saturation.

show abstract

“…Furthermore, Younsi and Nafla (2017) examine the relationship between financial stability, monetary policy, and economic growth in 40 developed and developing countries by using the annual panel data covering the sample period of 1993 to 2015 [35]. To do this, fixed and random effects panel data regression models were fitted to determine the impact of financial stability and monetary policy on economic growth.…”

Section: Negative Impact Of Monetary Policymentioning

confidence: 99%

Monetary Policy and Economic Growth in Developing Countries: Evaluating the Policy Nexus in Nigeria

Idris¹

2019

IJBER

View full text Add to dashboard Cite

While there are numerous studies on the relationship between monetary policy and economic growth, evaluating the policy nexus between the two phenomena remain inconclusive. Undeniably, monetary policy is believe to influence the employment level, price stability, growth of aggregate output and equilibrium in the balance of payment-for the case of developing economies. But the magnitude of its influence largely depends on how it is conducted through various channels and the independency of the apex bank to select the appropriate instruments for formulating the monetary policy. In lieu of that, this study examines the relationship between monetary policy and economic growth in Nigeria using time series data covering the period of 1980 to 2017. The study employs the Cointegration test and the Ordinary Least Square (OLS) technique with the view to estimating the model coefficients and showcase the policy nexus between the variables. Result indicates the existence of long-run relationship between monetary policy indicators and economic growth. Further empirical findings show that money supply has positive effect, while both exchange rate and interest rate have negative effect on the real GDP. As such, monetary authorities in Nigeria should adequately managed and monitored the growth level of money supply in order to realise the desired growth level. Given the socio-economic and political conditions in Nigeria, there is growing needs to formulate appropriate monetary measures which might encourage borrowing through sound and productive interest rate as well as stable exchange rate.

show abstract

Financial Stability, Monetary Policy, and Economic Growth: Panel Data Evidence from Developed and Developing Countries

Cited by 31 publications

References 22 publications

Modelling the monetary policy transmission on the manufacturing output: Evidence from the fastest growing Indian economy

Modelling the monetary policy transmission on the manufacturing output: Evidence from the fastest growing Indian economy

Modeling the Behavior of Banks in Instability Conditions

Monetary Policy and Economic Growth in Developing Countries: Evaluating the Policy Nexus in Nigeria

Contact Info

Product

Resources

About