Search

This paper examines the effects of news-based economic policy uncertainty (EPU) on domestic credit in the United Kingdom and the United States from 1900 to 2020. The Structural Vector Autoregression (SVAR) model results show that the EPU significantly decreases domestic credit both in the United Kingdom and the United States. Further results from the Volatility Spillover model indicate robust evidence of the negative impact of the EPU on domestic credit demand. The high spillover effect comes from the high EPU, which is associated with low domestic credit, and the low EPU is associated with increased domestic credit. The results are robust in different model procedures. The results indicate that consumers decrease durable consumption, and firms follow a wait-and-see strategy during times of higher EPU. [ABSTRACT FROM AUTHOR]

This study aims to show the response of foreign direct investment (FDI) inflows to monetary policy (represented by money supply and interest rate) and fiscal policy (represented by tax revenues) in Nigeria during the period (1990–2021). The autoregressive distributed lag approach is employed to estimate long‐run relationship among variables. The results indicate that there is cointegrating long‐run relationship among the study variables. The study provides empirical evidence showing that an increase in the percentage of money supply to gross domestic product (GDP) by (0.971%) leads to a decrease in the percentage of FDI inflows to GDP by (0.975%), an increase in the percentage of tax revenues to GDP by (4.256%) leads to a decrease in the percentage of FDI inflows to GDP by (0.975%), an increase in interest rate by (1.164%) leads to decrease in the percentage of FDI inflows to GDP by (0.975%), and an increase in inflation rate by (0.329%) leads to increase in the percentage of FDI inflows to GDP by (0.905%). [ABSTRACT FROM AUTHOR]

This paper examines the consequences of Chinese regulators deviating from a long-standing full bailout policy in addressing the distress of a city-level commercial bank. This policy shift led to a persistent widening of credit spreads and a significant decline in funding ratios for negotiable certificates of deposit issued by small banks relative to large ones. Our empirical analysis reveals a novel contagion mechanism driven by reduced confidence in future bailouts (implicit non-guarantee), contributing to the subsequent collapse of other small banks. However, in the longer term, this policy shift improved price efficiency, credit allocation, and discouraged risk-taking among small banks. [ABSTRACT FROM AUTHOR]

The difference in the results from previous studies on the impact of inflation on poverty, coupled with an increase in the money supply from direct investment, inspired this research. This study aimed to ascertain how poverty, inflation, and foreign investment affect consumption spending in Indonesia based on 1997-2021 time series data. This study used Vector Autoregression estimation, utilizing data sources from the World Bank. The data will be processed with econometric models. From the study’s findings, it may be inferred that overall consumption affects inflation, which can be seen from the Granger causality test that shows that this variable has a one-way causal relationship. The results of the same test also show that FDI has an effect on total consumption and conversely consumption has an effect on FDI. However, the poverty variable does not affect total consumption and vice versa, because according to the causality test, the variable obtains an insignificant probability value. However, the VECM results explain that poverty has an effect on total consumption, and that the effect of consumption on inflation is due to the larger t-statistic value and has a positive relationship. This implies that the rate of inflation will increase the lower the level of consumption. However, the Impulse Reason test shows that poverty has a negative trend, as does the FDI variable. [ABSTRACT FROM AUTHOR]

This research aims to examine the effect of a direct relationship between the use of e-money and the circulation of money on interest rates, as well as an indirect effect, namely through the intervening variable gross domestic product. This research method uses a statistical model of path analysis. The sample used was secondary data fetched from the Website of Bank Indonesia (BI) and the Central Bureau of Statistics (BPS), since regulation on electronic payment method was officially issued by Bank Indonesia in May 2009-March 2023. The test results shows that e-money and money supply each, have a significant positive effect on gross domestic product variables. Gross domestic product variables had a negative effect on interest rates. E-money and money supply variables has a negative effect on interest rates, both directly or indirectly through the intervening variable of gross domestic product. Increasing e-money user and money supply, preponderant to gross domestic product, can decrease the interest rate. The results of this research are expected to provide benefits as a prediction of the Indonesian economy in the future, as a result of the issuance of electronic payment instruments. So for the regulators, they can set the right interest rate policy to be able to maintain stable economic conditions. [ABSTRACT FROM AUTHOR]

We introduce the formation of a network of money flows between assets in stock markets, which captures directed relations between assets in terms of how investors have re-allocated money in the stock exchange. Our approach is based on identifying a directed link, or money flow, that occurs when an investor funds a purchase of an asset by selling another asset(s). We extract investor-level money flow networks on daily basis from shareholder registration data, which are then aggregated for both financial institutional and retail investors. Overall, we have a time series of 877 daily networks from 2006 to 2009, which is exceptionally long data on temporal networks. Through our analysis of non-reciprocated triadic patterns in the aggregated money-flow networks, we find that these patterns are both recurrent and significant. However, they are not related to the 2008 financial crisis. Additionally, we observe that the counts on different triadic motifs exhibit not only an autoregressive process but are also interconnected contemporaneously and dynamically. These findings suggest the need for further research using sophisticated network models to provide a comprehensive representation of money flows in stock markets. [ABSTRACT FROM AUTHOR]

Monetary policy is a policy set by the central bank to influence the circulation of money in the economy, which is reflected in the development of the money supply, interest rates, credit, exchange rates, and various other economic and financial variables. This study aims to analyze the influence of the implementation of women's rights in the Manpower Law on the level of welfare of women workers in the industrial sector. In the context of gender inequality that still occurs, it is important to explore how existing regulations can improve women's living and working conditions. This study uses a quantitative method with a sample consisting of female workers in several industrial companies. Data was collected through surveys that assessed the understanding and implementation of women's rights in the workplace, as well as their impact on their well-being. Data analysis was carried out using statistical techniques to test the hypothesis proposed. The results of the study are expected to provide a clear picture of the effectiveness of existing policies and their contribution to improving the welfare of women workers. The findings are also expected to serve as a reference for policymakers and companies in formulating better strategies to support women's rights in the industrial sector. [ABSTRACT FROM AUTHOR]

This study constructs Divisia monetary aggregates for the "Asian Tigers"—Hong Kong (1999–2024), South Korea (2009–2024), Singapore (1991–2021), and Taiwan (2005–2024)—and assesses whether Divisia monetary aggregates explain nominal GDP better than simple-sum money. Our findings demonstrate that Divisia indices respond more sensitively to economic shocks. For Hong Kong and Taiwan, narrow Divisia money provides the best explanations for fluctuations in nominal GDP. Our results suggest that Divisia monetary aggregates can be beneficial for monetary policy analysis in these territories and underscore the importance of further research into the empirical performance of Divisia monetary aggregates in macroeconomic prediction. [ABSTRACT FROM AUTHOR]

This paper aims to theoretically investigate how the presence of heterogeneous consumption behaviors, namely hand-to-mouth (HtM) and habit formation (HF), affects the monetary policy effectiveness and empirically explore the responses of three Association of Southeast Asian Nations (ASEAN) economies to external shocks. We employ the Bayesian methodology to undertake the Dynamic Stochastic General Equilibrium (DSGE) estimation using quarterly data. Empirical results indicate a HtM parameter of 22% in Indonesia, 34% in the Philippines, and 27% in Thailand, with the HF parameter estimated at around 50%. Given the estimated parameters, a monetary shock would have standard effects on macroeconomic variables. Besides, incorporating HtM consumers into a standard DSGE model amplifies the adverse effects of monetary shock on aggregate consumption/output growth. Also, a higher ratio of HtM consumers exacerbates the negative effects of monetary shock, but it does not influence much the adverse impacts of demand and supply shocks on macroeconomic variables. [ABSTRACT FROM AUTHOR]

Monetary analysis has been out of fashion lately. However recent economic and inflation dynamics call for renewed attention. Since 2021, broad money growth has been associated with high inflation and overheated production. Central banks and academia should pay more attention to monetary analysis to understand the economic dynamics and formulate better monetary policy. This article briefly reviews the monetary analysis practices of major central banks and then focuses on China as a case study. We set out the features of the balance sheet of depository corporations, and use it as a basic framework for monetary analysis. There are seven money‐supply channels of broad money, which fluctuate because of seasonality, demand conditions, regulation, and financial institutions micro‐managing indicators. Any change of broad money will be reflected through the balance sheet. Applications include analysing long‐term evolution of money supply channels, analysing and predicting monetary growth, recording major financial incidents, and so forth. [ABSTRACT FROM AUTHOR]

Monetary targeting served as a useful tool for conducting monetary policy until 1980s, but the instability in the relationship between money and nominal income led to its abandonment by most economies. One way of measuring this relationship is money velocity, defined as the ratio of nominal income to money. The purpose of the present study is to show that if short-run cyclical factors are accounted for, money velocity function becomes stable and thus any change in monetary aggregates will lead to predictable change in nominal income and therefore inflation. In such a scenario, monetary targeting can serve as a useful tool in the conduct of monetary policy. The study utilizes quarterly data from 1996:Q2 to 2020:Q1 and time series methodology to conduct empirical analysis. Findings show that money velocity and all its identified determinants exhibit pro-cyclical behaviour. After accounting for these determinants, money velocity has been found to be stable. The direction of causality runs from money velocity to rate of interest to investment to GDP. Thus, when formulating monetary and fiscal policies, policymakers can monitor the short-term cyclical patterns in money velocity as an indicator of forthcoming expansionary or contractionary conditions in the economy to design effective policies. [ABSTRACT FROM AUTHOR]

The purpose of the study is to analyze the relative efficacy of monetary and fiscal policies in fostering economic growth in Bangladesh concerning predictability, speed, and magnitude. Moreover, it aims to find the relationship between the economic boom of Bangladesh and two measures of macroeconomic management i.e., monetary and fiscal policy. The ARDL model and bound test are applied to examine the long-term link between monetary policy, fiscal policy, and economic growth. Data is obtained from the World Development Indicator (WDI) for Bangladesh for the period 1974 to 2022. Several diagnostics tests like CUSUM and CUSUMQ are used to identify both the strengths and weaknesses of the models. The findings demonstrated a long-term correlation between the two policies and economic growth. According to the calculated short-run coefficients, the short-term effect of fiscal policy is mentionable but the effect of monetary policy is negligible in the short term. But over time, the immediate effects become noteworthy. The long-term outcomes indicated that both fiscal and monetary policies have a favorable and substantial long-term impact on economic growth. The result shows fiscal policy is more effective compared to monetary policy for making Bangladesh, a role model of Bangladesh. Furthermore, all the diagnostics tests showed the stability of the estimated ARDL model. Expansionary fiscal and monetary policies lead to higher government spending and an increase in the money supply, which raises GDP levels. Conversely, if government spending and the money supply decline (contractionary fiscal and monetary policies), the GDP level falls. As a result, this study suggests using expansionary policies to boost Bangladesh's economy. [ABSTRACT FROM AUTHOR]

The purpose of this research is to explore and summarize aspects of the current state and development trends in Albania's banking sector. The analysis shows that the banking system dominates the country's financial landscape, while the securities market remains nascent. Adverse inflationary dynamics are also observed. The research demonstrates dependencies between key banking indicators like non-performing loans, capital adequacy ratio and money supply on economic factors. The prospects for Albania's banking sector are challenged by the volatile global economy, however promoting lending, improving asset quality and supporting businesses can help establish stability. Expanding the securities market can also assist banking sector growth. The practical significance is that the identified trends and relationships can inform policy decisions to facilitate robust banking sector performance. [ABSTRACT FROM AUTHOR]

Via a forward SDE solution $ (k_t, t\geq 0) $ that captures money supply dynamics, a macroeconomic model known as the monetary model generates a backward exchange rate process $ (y_t, t\geq 0) $. For any $ t\geq 0 $, $ y_t=k_t+\alpha^{-1}\mu_t $ where $ (\mu_t, t\geq 0) $ is a backward process and $ \alpha>0 $ is a constant. Thus, $ (y_t, t\geq 0) $ does not satisfy a conventional BSDE. Our paper proves $ (y_t, t\geq 0) $ is a continuous semimartingale when restrictions on the SDE for $ (k_t, t\geq 0) $ capture anti-inflationary initiatives. This new result in economic dynamics does not require the filtration to be the Brownian filtration. [ABSTRACT FROM AUTHOR]

We estimate the effect of money supply changes on the real economy by exploiting a recurring natural experiment: maritime disasters in the Spanish Empire (1531–1810) that resulted in the loss of substantial amounts of silver money. We find that negative money supply shocks caused Spanish real output to decline. A transmission channel analysis highlights slow price adjustments and credit frictions as mechanisms through which money supply changes affected the real economy. Especially large output declines occurred in textile manufacturing against the backdrop of a credit crunch that impaired merchants' ability to supply their manufacturers with inputs. [ABSTRACT FROM AUTHOR]

The fiscal policy's impact on the real exchange rates is highly controversial in theory and practice but noteworthy for macroeconomic policy. This issue is more pertinent in developing countries with an active fiscal policy or wider fiscal space but is explored less. To our knowledge, the fiscal policy impact on the real exchange rate in India is not documented. Against this backdrop, this study explores this in India involving disaggregated data of government consumption and investment spending and a few related variables like trade openness, private consumption spending, and money supply for the period 1996:1–2023:1. The results corroborate long-run associations of real exchange rate and some combinations of the selected other variables. The real exchange rate dynamics estimated through the cointegrated vector autoregressive model followed by an impulse response analysis have shown that government investment spending causes a real appreciation. In contrast, government and private consumption spending exert pressure to depreciate the real exchange rate. Trade openness is another potent predictor of the real exchange rate. On the other hand, no significant impact of the money supply on the real exchange rate is noticed. The results accentuate effective fiscal allocation may be a policy tool for stabilizing the Indian rupee. The unique findings on the Indian economy may also help understand the fiscal effect of real exchange rates in other developing countries. [ABSTRACT FROM AUTHOR]

This paper contributes to the debate on the re-appraisal of monetization mechanism as a possible tool for dealing with macroeconomic imbalances due to close economic shocks (e.g. the Covid pandemic, the Russia-Ukraine conflict and the escalation in Israel-Hamas crisis). We analyze and empirically discuss the well-known Quantity Theory of Money (QTM), by applying the SVAR methodology to a heterogeneous panel including several Countries (Australia, China, India, Japan, United Kingdom and the United States) plus the block of Euro Zone (EZ) over the period 1992–2022. We investigate the dynamics and the impacts of the variables included in the theoretical model (inflation, GDP growth, money growth and the change in the velocity of money) through the analysis of the macro economic datasets retrieved from the OECD and Trading Economics databases. We find that money growth does not exert the decisive spillover effect on the path of inflation (i.e. common shock) throughout our sample. Moreover, our results indicate that the idiosyncratic component does not show a predominant and determining role of monetary growth in inflationary dynamics. [ABSTRACT FROM AUTHOR]

We derive a new theoretical model of money demand, which reflects backward‐ and forward‐looking preferences in consumption and utility. The former aspect is captured by standard habit formation, and the latter by anticipation of future consumption preferences. By introducing both of these into the Ramsey–Sidrauski framework, we unveil a new highly general model of money demand. We discuss the model in light of the apparent breakdown of money‐demand functions and diminished policy relevance of monetary aggregates. [ABSTRACT FROM AUTHOR]

This study examined South Africa's economic growth rate from 1980 to 2022 through an econometric analysis of fiscal and monetary policies. The study sought to investigate the relationships between the economy's growth rate and various fiscal and monetary policy variables, taking into account different economic approaches such as Keynesian, monetarist, and Wagner's perspectives. The methodology used consisted of data preparation, multiple unit root tests, Autoregressive Distributed Lag (ARDL) cointegration analysis, diagnostic tests, and pairwise Granger causality analysis. The empirical analysis found a long-term cointegration among the economic growth rate, government debt, expenditure, and revenue in fiscal policy, though government debt and expenditure were not statistically significant. Contrary to economic theory, increased government revenue had a negative correlation with economic growth. There was no long-term relationship found between the economic growth rate and monetary policy variables such as the official exchange rate, inflation rate, real interest rates, and M3 money supply. Pairwise Granger causality tests revealed a one-way relationship between government spending and economic growth, providing support to the Keynesian approach to fiscal policy. This study also discovered evidence that economic growth Granger-causes inflation, implying that economic growth may have predictive power for inflation, consistent with the demand-pull inflation hypothesis. However, no direct predictive relationships were found between the selected monetary policy variables and economic growth, supporting the long-run theory of monetary neutrality. This study suggests evaluating spending, managing inflation, implementing reforms, closing infrastructure gaps, encouraging investment, and ensuring fiscal sustainability. [ABSTRACT FROM AUTHOR]

One of the most widely researched macroeconomic relationships is money demand stability, which helps monetary authorities understand what motivates economic agents hold real money balances and whether it can predict inflation. However, endogenous structural shocks to macroeconomic fundamentals have often been criticized for distorting the equilibrium relationship among economic variables. These shocks usually stem from socioeconomic and political changes, behavior of economic agents, and random shocks. We examine the presence of cointegrating relationships between money demand and scale and opportunity cost variables while allowing for multiple endogenous structural breaks in the cointegrating vectors in the Indian context for the period 1996:Q2–2021:Q2. We utilize the Narayan and Popp (J Appl Stat 37(9):1425–1438, 2010) test to identify the break dates in each series and then employ the Maki (Econ Model 29(5):2011–2015, 2012) cointegration approach to establish the presence of long-run relationships between money demand and its covariates. Our study finds the presence of stable long-run relationships in the money demand function, implying that monetary authorities may target narrow and broad monetary aggregates as an indicator or treat them as an information variable to anchor the inflation expectations of economic agents under the current flexible inflation-targeting framework. [ABSTRACT FROM AUTHOR]

The study aims to measure the impact of macro shocks (internal & external) on the Iraqi economy in general and on the agricultural sector in particular, by measuring the impact of some macro variables on the gross domestic product and then the agricultural output through the use of two-stage least squares, as the results of estimating the relationship showed In the long term, all economic variables addressed in this research have significant effects on the gross domestic product through joint integration. The most influential of these variables is government spending, , then the exchange rate rate, taxes, and finally the inflation rate, and when the economic variables deviate in the long term Short from their long-run equilibrium values by one unit for each, 67% of this deviation is corrected per year, meaning that the GDP will take approximately a year and a half to return to its equilibrium value, as the response impulse function analysis showed that when Shocks in some economic variables, their impact appears significantly in the long term, and the study recommends paying attention to the international economic transformations affecting the agricultural sector, through adopting appropriate agricultural policies, and employing the achievements of science and technology in order to use modern agricultural techniques locally, in addition to transferring and settling them, as well as reducing Inflation rates are at low and acceptable levels, The researcher also recommends intensifying studies and scientific research on the agricultural sector to delve deeper into the problems that this sector suffers from and find appropriate solutions to them.

In this study using yearly data, it is examined if the effect of money supply (broad money) on inflation is asymmetric or not. 38 countries which have 5% and above inflation rate in average during the period of 1989–2018 are investigated through the panel data analyses. The study differs from other researches, which use monetary shocks in explaining the asymmetric relation, in which that it uses broad money change intervals along with control variables to see the asymmetric impact. Using broad money change intervals, it is concluded that the relation between broad money and inflation is explained better in the asymmetric pooled and fixed effect panel data models, compared to the symmetric models. According to the results, the effects of negative and positive changes in money supply on inflation are not symmetric. Moreover, as broad money increases, inflation goes up further. In the light of this information, it is possible to mention an asymmetric relation between broad money and inflation.

In chapter 15 of volume 2 of Capital, Marx introduced the concept of set-free money capital during the turnover process of industrial capital, positing its role in the credit system. Saros further formalized this process, suggesting that set-free money capital could serve as loanable funds, impacting the credit system. This article advances this research by making three significant contributions. Firstly, it offers a more succinct formalization of the turnover process, improving pedagogical clarity. Secondly, it reinterprets the significance of set-free money capital within the modern credit money system using post-Keynesian endogenous money theory, linking production directly to the money supply. Lastly, it demonstrates through simulations that production structure influences the periodic fluctuations of set-free money capital at the macro level, affecting the money supply. JEL Classification : B51, E32, E51 [ABSTRACT FROM AUTHOR]

The primary purpose of this study is to analyze the effects of the money supply on exchange rates in ASEAN-5 and whether there is an exchange rate overshooting phenomenon with the application of the Dornbusch Overshooting Model. This study uses the Autoregressive Distributed-Lag (ARDL) method to analyze the short and long-term effects and uses time series data from 1980 to 2021 in ASEAN-5. The results of this study are still ambiguous in finding the overshooting phenomenon in ASEAN-5. In the short term, the research results support overshooting in two countries, Malaysia and Thailand. However, in the long term, no positive and significant influence was found between the money supply gap and exchange rate misalignment in ASEAN-5. Besides that, the inflation gap, interest rate gap, and output gap also greatly influence changes in exchange rate misalignment and have different significant effects in the short and long term.

This study investigates the factors influencing food inflation in Turkey, employing both endogenous and exogenous models and integrating major literature findings. Utilizing monthly data from February 2007 to November 2023, standardized for analysis, it explores the relationship between food inflation and various determinants through classical and Bayesian methods. The analysis reveals that increases in the real effective exchange rate, money supply (M1), Turkish and Federal Reserve interest rates, and the food and beverage price index contribute to rising food inflation. Conversely, higher oil prices have a statistically significant negative effect on food inflation. The most influential variables, determined by their inclusion probabilities in the model, are the money supply, Federal Reserve interest rate, real effective exchange rate, and Turkish interest rate. These findings underscore their importance in understanding and analyzing changes in Turkey's food inflation.

This paper focuses on the examination of the long-run relationship between money supply and selected national and global stock indices. Detailed knowledge of this relationship can be used by analysts, investors and monetary policy makers. Analysis of the relationship was performed using a 2-stage Engle-Granger cointegration. First, the stationarity of the time series was tested, then both the long-term OLS model and the short-term EC model were estimated. Time series were always tested on the longest period for which data were available. The longterm dependence of stock indices on the respective M2 was confirmed for the BOVESPA, FTSE100, S&P/BMV IPC, S&P BSE500, TSX and The 5000 Wilshire Small Cap Price Return indices. In contrast, the dependence between world money supply indicator GlobalM2, the stock index FTSEALL World, and the S&P500 index was not demonstrated. Additionally, no dependence was identified between the respective M2 and the DAX, PX, Nikkei225, KOSPI, SMI, SPCITIC300, Eurostoxx50, Willshire5000PR and ATX indices. Backward dependence of M2 on the stock index was found only for the Chinese SPCITIC300 index.

This paper examines equilibrium asset prices and leverage in an exchange economy populated with both retail and institutional investors. Institutional investors influence the price of the stocks they trade and are aware of the price impact of the opponent and, thus, interact strategically. Because of the price impact, institutional investors decrease their demand for stocks and lend money to the retail sector, thereby increasing leverage in the economy. The risk-free rate (equity premium) tends to be lower (higher) as compared to an economy populated by retail investors only. Retail investors' compensation for liquidity provision depends on the behavior of institutional investors and the state of the economy. [ABSTRACT FROM AUTHOR]

During the 1990s and 2000s, many developing nations accepted fixed exchange rate regimes to sustain price stability. By pegging their currencies to an anchor currency (i.e. US dollar), developing countries could bring credibility and confidence into their economies. The study tries to analyse the impact of the pegged exchange rate regime on inflation in BRICS countries for the period spanning from 2003 to 2022. The result points to the loss of monetary policy autonomy due to the ‘impossible trinity’ coming into play with a steady increase in capital inflows. The country’s large trade surpluses and extensive trade relationships may buffer the impact of exchange rate fluctuations on domestic prices, as changes in the exchange rate may be absorbed by changes in trade volumes or pricing strategies. Other factors like demographic trends or government interventions in markets could overshadow the influence of the exchange rate regime on inflation. The impact of changes in the exchange rate regimes on inflation may operate with lags, meaning that any effects may not be immediately observable in the data. The analysis in this study proposes that exchange rate regimes choice and money supply influence the inflation dynamics in the BRICS countries. It merely reflects the success of the central bank in neutralizing its very effort of maintaining the pegged rate, which gives rise to inflationary growth of the money supply. [ABSTRACT FROM AUTHOR]

In this article, we study the autocorrelation function (ACF), which is a crucial element in time series analysis. We compare the distribution of the ACF, both from a theoretical and empirical point of view. We focus on white noise processes (WN), i.e., uncorrelated, centered, and identically distributed variables, whose ACFs are supposed to be asymptotically independent and converge towards the same normal distribution. But, the study of the sum of the sample ACF contradicts this property. Thus, our findings reveal a deviation of the sample ACF from normality beyond a specific lag. Note that this phenomenon is observed for white noise of varying lengths, and evenforn the residuals of an ARMA( p , q ) model. This discovery challenges traditional assumptions of normality in time series modeling. Indeed, when modeling a time series, the crucial step is to validate the estimated model by checking that the associated residuals form white noise. In this study, we show that the widely used portmanteau tests are not completely accurate. Box–Pierce appears to be too conservative, whereas Ljung–Box is too liberal. We suggest an alternative method based on the ACF for establishing the reliability of the portmanteau test and the validity of the estimated model. We illustrate our methodology using money stock data in the USA. [ABSTRACT FROM AUTHOR]

The COVID-19 pandemic, the Russia–Ukraine and the Israel–Hamas conflicts, and the resulting global economic shocks will affect the world economy for several years. This paper analyzes and discusses monetary finance (MF) using the Quantity Theory of Money (QTM) to understand economic dynamics. To achieve this goal, we utilize a Structural Vector Autoregressive (SVAR) identification scheme with sign restrictions on datasets from advanced economies. The findings indicate that monetary growth plays a role in short-term inflationary dynamics, while its effects are less significant in the medium to long term. The aim of the paper is to contribute to ongoing debate surrounding the potential strategies for addressing the economic downturn through the reintroduction of monetary finance (MF). [ABSTRACT FROM AUTHOR]

Copyright of Global Journal of Economics & Business is the property of Refaad for Studies, Research & Development and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This article hypothesizes that firms demand more money to maintain low and stable inventory in order to fully exploit the globalization of supply chains. Three test implications derived from the hypothesis are verified with the US data: that the ratio of money held by firms over M1 trends up and becomes more volatile, that the ratio would plunge if there is a tremendous shock to supply chains, and that the ratio positively impacts real money balance in the long run cointegrated equilibrium with real income and short-term interest rate as control variables. Elevated money demand from the firm sector could partially explain the missing inflation in the 2010s. [ABSTRACT FROM AUTHOR]

While credit cards provide transaction services, they have never been included in measures of money supply. We derive the theory to measure the joint services of credit cards and money and propose two measures of their joint services: one based on microeconomic structural aggregation theory, providing an aggregated variable within the macroeconomy; the other a credit‐card‐extended aggregate, optimized as an indicator to capture the contributions of monetary and credit card as nowcasting indicator of nominal GDP. The inclusion of the new aggregates yields substantially more accurate nowcasts of nominal GDP, illustrating the usefulness of the information contained in credit cards. [ABSTRACT FROM AUTHOR]

Several policymakers and academic works have been discussing the nature of Central Bank Digital Currency (CBDC) as well as its debated relationship with crypto-assets. CBDC would allow the private (non-financial) sector to access the central bank’s reserves. Given its superior hierarchy in the money spectrum, CBDC adoption could trigger a strong or mild conversion from deposits, depending on its design, with strong impacts on the assets and liabilities composition and magnitude of different actors. The aim of this paper is to study the dynamics related to the transmigration process from deposits to CBDC as well as the process of money creation through a detailed step-by-step analysis, tracking the transactions between the institutions involved in its adoption. It underlines the validity of the endogenous money theory (EMT) in describing those transactions while clarifying the maintenance of the commercial banks’ vital role in the process of money creation, in a world with the emergence of CBDC. [ABSTRACT FROM AUTHOR]

It is difficult to predict index values or stock prices with a single financial formula. They are affected by many factors, such as political conditions, global economy, unexpected events, market anomalies, and the characteristics of the relevant companies, and many computer science techniques are being used to make more accurate predictions about them. This study aimed to predict the values of the XKAGT index by using the monthly closing values of the Borsa Istanbul (BIST) Forestry, Paper and Printing (XKAGT) index between 2002 and 2023, and the machine learning techniques artificial neural networks (ANN), random forest (RF), k-nearest neighbor (KNN), and gradient boosting machine (GBM). Furthermore, the performances of four machine learning techniques were compared. Factors affecting stock prices are generally classified as macroeconomic and microeconomic factors. As a result of examining the studies on determining the macroeconomic factors affecting the stock markets, 10 macroeconomic factors were determined as input. The macroeconomic variables used were crude oil price, exchange rate of USD/TRY, dollar index, BIST100 index, gold price, money supply (M2), S&P 500 index, US 10-year bond interest, export-import coverage rate in the forest products sector, and deposits interest rate. It was determined that all machine learning techniques used in the study performed successfully in predicting the index value, but the k-nearest neighbor algorithm showed the best performance with R2=0.996, RMSE=71.36, and a MAE of 40.8. Therefore, in line with the current variables, investors can make analyzes using any of the ANN, RF, KNN, and GBM techniques to predict the future index value, which will lead them to accurate results. [ABSTRACT FROM AUTHOR]

Economic downturns represent an inevitable challenge that nations and businesses must confront, presenting considerable risks. As a result, it becomes imperative for them to formulate strategies to secure their survival. The world has recently experienced an economic downturn due to a pandemic. COVID-19 has caused a significant economic crisis, leading to job losses and disruptions across various sectors worldwide, including the Philippines. The study utilizes economic indicators to determine patterns, meanings, and subsequent opportunities. Specifically, the study sought to identify relevant economic indicators, find patterns and meaning within each indicator and among indicators, and determine implications from findings. Content analysis was used in the study. It is a qualitative research method to identify and interpret themes, meanings, and patterns. The materials used include eleven Philippine economic indicators, namely, the Philippine Stock Exchange Composite Index, Balance of Trade, Core Inflation Rate, Consumer Spending, Tourist Arrivals, Consumer Confidence, Consumer Credit, Gold Reserves, Foreign Exchange Reserves, and Money Supply M2, and Interest Rate. In conclusion, the study determined that the collective surge in economic activities is positively related to the rise of inflation; increased interest rates potentially mitigated the rise in inflation, and other factors negated the trade deficits and gold reserve fluctuations. The Philippine economy is on the path to recovery, and the unique interrelations of economic indicators imply a more stable environment in the Philippine economy. This signals a green light for investors and an opportunity for policymakers to fine-tune existing initiatives to sustain economic recovery. [ABSTRACT FROM AUTHOR]

We study the role of markup dispersion and aggregate TFP for monetary transmission. Empirically, we show that the response of markup dispersion to monetary policy shocks can account for a significant fraction of the aggregate TFP response in the first two years after the shock. Analytically, we show that heterogeneous price rigidity can explain the response of markup dispersion if firms have a precautionary price-setting motive, which is present in common New Keynesian environments. We provide empirical evidence in support of this explanation. Finally, we study the mechanism and its implications in a quantitative model. [ABSTRACT FROM AUTHOR]

The scientific article is devoted to the study of the purpose of the monetary policy of the central banks of the EU member states and Great Britain, its instruments and legal acts, in which they are fixed. The legislation of the member countries of the European Union (Germany, France, Spain, Poland, the Czech Republic, Hungary) and Great Britain, modern approaches in the science of constitutional and administrative law regarding the definition of the goal of the monetary policy of the central banks of the member countries of the EU, and the range of its instruments are analyzed. Emphasis is placed on the fact that the purpose and functions of national banks are interrelated, but not identical. The concept of the goal of the monetary policy of the Central Banks of the EU member states, the activities and instruments of the monetary policy, the functions of the central bank of the EU member states are delineated. It is argued that reducing the purpose of the activities of the central banks of EU member states and Great Britain exclusively to the implementation of legal regulation of currency circulation in the state and that the main purpose of the central banks of such EU member states as the Czech Republic, Poland, and Hungary is purely to ensure the stability of the currency - is not justified. It is argued that the main joint functions of the central banks of Germany, France, Spain, Poland, the Czech Republic, Hungary and Great Britain are to ensure the stability of the monetary unit, to promote the maintenance of sustainable rates of economic growth, to achieve and maintain price stability in the state, and to support economic policy. It is established that the goal of the monetary policy of the central banks of the EU member states is to ensure price stability, and it is additionally substantiated that the inflationary inclination of the financial policy is the most effective. It was established that the accounting policy, the interest rate policy, and the regulation of mandatory reserve norms, the volume of the money supply, operations on the open market and operations with credit resources, the amount of interest rates, interest rates of the mandatory reserve of banks are not the purpose of monetary and credit policies, instruments of monetary policy of the central banks of EU member states and Great Britain. [ABSTRACT FROM AUTHOR]

Copyright of Investigación Económica is the property of Universidad Nacional Autonoma de Mexico, Facultad de Economia and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This study investigates the complex relationship between oil price fluctuations and economic growth in Algeria, using time series data from 1973 to 2023. Advanced econometric techniques, including Vector Autoregression (VAR), Impulse Response Functions (IRFs), Variance Decomposition (VD), and the Toda-Yamamoto causality test, were employed to examine both the direct and indirect effects of oil price changes on the country's growth. The results of the VAR model indicate a strong positive relationship between oil prices and economic growth, emphasizing the critical role of hydrocarbon exports in driving Algeria's economy. However, this connection is influenced by other macroeconomic factors, such as inflation, exchange rates, and money supply. IRF analysis shows that while oil price increases initially stimulate growth, long-term impacts are moderated by adjustments in monetary policy and exchange rates. The variance decomposition analysis further highlights that oil price volatility significantly influences short-term economic performance, but its effect diminishes over time, suggesting progress in economic diversification, policy adaptation, and the effectiveness of managing oil-related volatility. The Toda-Yamamoto causality test provides additional insights, confirming unidirectional causality from oil prices to growth and highlighting indirect effects through exchange rates and money supply. These findings underscore the importance of continued diversification efforts in oil-dependent economies like Algeria, as well as the need for adaptive monetary and exchange rate policies to ensure both short-term stability and long-term growth. This study contributes to the broader literature on oil price-growth dynamics and offers valuable guidance for policymakers in resource-rich countries. [ABSTRACT FROM AUTHOR]

In this study using yearly data, it is examined if the effect of money supply (broad money) on inflation is asymmetric or not. 38 countries which have 5% and above inflation rate in average during the period of 1989-2018 are investigated through the panel data analyses. The study differs from other researches, which use monetary shocks in explaining the asymmetric relation, in which that it uses broad money change intervals along with control variables to see the asymmetric impact. Using broad money change intervals, it is concluded that the relation between broad money and inflation is explained better in the asymmetric pooled and fixed effect panel data models, compared to the symmetric models. According to the results, the effects of negative and positive changes in money supply on inflation are not symmetric. Moreover, as broad money increases, inflation goes up further. In the light of this information, it is possible to mention an asymmetric relation between broad money and inflation. [ABSTRACT FROM AUTHOR]

This paper analyzes the response of cryptocurrency returns to the movement of economic policy uncertainty (EPU) and stock market volatility (VIX), as well as a few macroeconomic variables: gold price, interest rate, inflation rate, and oil price. Vector error correction model and regression model are applied to examine the linkage between these variables using data from 2015 to 2022. The analysis reveals that the selected variables have a positive and significant impact on cryptocurrency returns. This suggests that cryptocurrency can be considered a safe haven for investment. The paper also suggests a number of policies to ensure the protection of investment, control money supply and stock market instability, stabilize economic uncertainty, and systematize economic variables. This paper advocates a well-connected network and active participation of stakeholders such as government, central bank, security exchange, and financial institutions will help to streamline irrational movements and enhance the acceptability of cryptocurrencies through the framing and implementation of necessary regulations. [ABSTRACT FROM AUTHOR]

This paper analyzes the impact of "spirit of capitalism" on stationary welfare and stability properties of a one‐sector Ramsey economy, where the demand of money is motivated by a cash‐in‐advance constraint on consumption expenditures. Preferences are defined over consumption and capital stock. There is a monetary authority that follows either a money growth pegging rule or an interest rate pegging rule. When a money growth pegging rule is introduced, a unique steady state emerges. A slight desire for status is a sufficient condition for an increase in the money growth rate to exert a local stabilizing effect and to improve stationary welfare. When an interest rate pegging rule is introduced, two steady states may emerge: a "liquidity trap" and an "interior" steady state. Both steady states are locally determinate. Moreover, we show that a slight desire for status is also a sufficient condition to ensure that the stationary welfare at "interior" steady state is higher than the one of the "liquidity trap". It follows that an increase in the policy rate is, then, an efficient way to exit the "liquidity trap" steady state. Under similar conditions, a higher policy rate increases the stationary welfare at the "interior" steady state. [ABSTRACT FROM AUTHOR]

This study employs the estimation of aggregate import demand under foreign exchange constraints in Ethiopia, utilizing annual time series data from 1985 to 2021. The regression analysis is conducted using the nonlinear autoregressive distributed lag (NARDL) approach to investigate the impact of the accumulation of foreign exchange reserves on aggregate import demand in Ethiopia. The estimation results indicate that, in the long run, all the variables, i.e., foreign exchange reserve, the relative price of imports, real income, volatility of the exchange rate, money supply, and policy dummy, significantly determine the behavior of aggregate imports over the reference period. The findings also show that, in the long run, foreign exchange reserve, real income, and the exchange rate positively affect the demand for imports in Ethiopia. Meanwhile, a positive shock in relative import price and money supply negatively affects import demand in Ethiopia. Thus, the price and income elasticity estimates have correct signs and are statistically significant. The variables included in the model strongly affect import demand in both the short and long run. Finally, policymakers aiming to significantly influence import demand should focus on effective management of these variables, as they strongly affect import volume. [ABSTRACT FROM AUTHOR]

This study aims to examine the budget deficit–inflation relationship, considering financial sector development and broad money supply as moderating and mediating variables. For this purpose, a panel data set ranging from polled mean group, mean group, and dynamic fixed effect estimation techniques are employed. Hence, the pooled mean group estimation result reveals that the budget deficit is inflationary. In addition, GDP per capita, the effective exchange rate, financial sector development, regulatory quality, and the interaction term of the budget deficit and financial sector development are significant determinants of inflation. The study further examines the role of the broad money supply as a mediating variable in the budget deficit–inflation relationship. The structural equation model results and the mediation effect tests confirmed a partial mediation effect of the broad money supply on the budget deficit–inflation relationship. Based on the findings, it is recommended to strengthen regulatory quality, reduce broad money supply, and improve financial sector development. By doing so, we can create a more stable and efficient economy that benefits everyone in the long run. [ABSTRACT FROM AUTHOR]