The growth of government spending and the money supply

2006 ◽  
Vol 33 (6) ◽  
pp. 406-436 ◽  
Author(s):  
Magda Kandil
Keyword(s):  
Money Supply ◽  
Government Spending

The end of Alchemy of Finance and Sovereign Money (on the books by M. King “The end of Alchemy: Money, Banking and the Future of the Global Economy” and by J. Huber “Sovereign Money. Beyond Reserve Banking”)

2017 ◽  
pp. 131-141 ◽  
Author(s):  
V. Yefimov
Keyword(s):  
Economic Policy ◽  
Central Bank ◽  
Institutional Theory ◽  
Money Supply ◽  
Government Spending ◽  
Global Economy ◽  
Private Banks ◽  
Money Creation ◽  
Ministry Of Finance ◽  
Reserve Banking

The review discusses the institutional theory of money considered in the books by King and Huber, and the conclusions that follow from it for economic policy. In accordance with this theory, at present the most of the money supply is created not by the Central Bank but by private banks. When a bank issues a loan, new money is created, and when the loan is repaid this money is destructed. The concept of sovereign money involves the monopoly of money creation of the central bank. In this case the most of newly created money is handed over to the ministry of finance to implement government spending.

Demand-pull Inflation and Cost-push Inflation: Factors of Origination and Forms of Expansion

2011 ◽  
pp. 40-52 ◽  
Author(s):  
O. Dmitrieva ◽  
D. Ushakov
Keyword(s):  
Money Supply ◽  
Government Spending ◽  
Raw Materials ◽  
Demand Pull

The paper treats the problems of correlation among inflation, increase in government spending and increase in money supply (M2). It is shown that there is no correlation for 13 out of 14 investigated countries including Russia. The paper proves that the type of inflation in Russia is cost-push inflation. Its main sources are monopolistic surplus for raw materials and energy being included in prices as well as prices for the products of natural federal and regional monopolies.

DETERMINAN INFLASI DI INDONESIA PERIODE 1980-2015

2016 ◽  
Vol 21 (1) ◽  
pp. 1-7
Author(s):  
Risna Risna
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Money Supply ◽  
Government Spending ◽  
Positive Impact ◽  
Secondary Data ◽  
Quantitative Approach ◽  
State Spending ◽  
Factors Affecting ◽  
The Interest Rate

This study aims to determine the effect of government spending, the money supply, the interest rate of Bank Indonesia against inflation.This study uses secondary data. Secondary data were obtained directly from the Central Bureau of Statistics and Bank Indonesia. It can be said that there are factors affecting inflationas government spending, money supply, and interest rates BI. The reseach uses a quantitative approach to methods of e-views in the data. The results of analysis of three variables show that state spending significantand positive impact on inflationin Indonesia, the money supply significantand negative to inflationin Indonesia, BI rate a significantand positive impact on inflation in Indonesia

scholarly journals INFLASI DARI SUDUT PANDANG MONETER DAN FISKAL (STUDI KASUS SUMATERA BARAT)

2019 ◽  
Vol 1 (1) ◽  
pp. 131
Author(s):  
Zul Azhar ◽  
Alpon Satrianto ◽  
Nofitasari Nofitasari
Keyword(s):  
Interest Rate ◽  
Money Supply ◽  
Government Spending ◽  
Descriptive Research ◽  
Distributed Lag ◽  
Long Run ◽  
Negative Effect ◽  
Short Run ◽  
The Interest Rate ◽  
Positive Effect

This study aims to analyze the effect of money supply M2, interest rate, government spending and local tax on the inflation in West Sumatera. This type of research is descriptive research and secondary datain the form of time-series from quartely 1 2007 to 2017 quartely 4 using the method of Autoregresive Distributed Lag analysis. The results of this study indicate that money supply in the long run have a significant and positive effect on inflation West Sumatera. In the short run  and long run the interest rate has a significant and positive effect on inflation in West Sumatera. Government spending in the Long run has a significant and negative effect on inflation in West Sumatera. Based on the result of this study can be concluded that there is inflation in West Sumatera is monetery of phenomenon in the long run. 

HOW THE EXCHANGE RATE REGIME AFFECTS ADJUSTMENT TO LARGE OIL PRICE SWINGS IN OIL EXPORTING COUNTRIES

2021 ◽  
Author(s):  
MAJED S. ALMOZAINI
Keyword(s):  
Exchange Rate ◽  
Money Supply ◽  
Government Spending ◽  
Exchange Rate Regime ◽  
Exchange Rate Regimes ◽  
Oil Price ◽  
Fixed Exchange Rate ◽  
Floating Exchange Rate ◽  
The Exchange Rate

The aim of this study is to analyze how oil price shocks affect the economic growth of floating exchange rate regimes and fixed exchange rate regimes in oil-exporting countries with a ratio of oil exports to total exports exceeding 70%. Also, this study seeks to determine what monetary and fiscal policies both regimes apply in order to curb business cycles and reduce inflationary and recessionary gaps. The analytical study uses panel data for the period from 1991 to 2019, covering 24 oil-exporting countries, from the World Economic Outlook (WEO) database and World Bank. The econometric model is estimated by applying a panel VECM to examine the short- and long-term interdependencies in the macroeconomic variables. The results demonstrate that when there is a negative shock to the oil price, the exchange rate of the floating exchange rate regimes depreciates, money supply increases, and government spending decreases. In contrast, the exchange rate of the fixed exchange rate regimes fluctuates slightly; the money supply slightly decreases in the near, medium, and long term; and government spending decreases.

scholarly journals Inflation Sources Across Developed And Developing Countries; Panel Approach

2012 ◽  
Vol 11 (2) ◽  
pp. 185
Author(s):  
Nayef Al-Shammari ◽  
Mohammed Al-Sabaey
Keyword(s):  
Developing Countries ◽  
Exchange Rate ◽  
Interest Rate ◽  
Money Supply ◽  
Government Spending ◽  
Oil Prices ◽  
Developed Countries ◽  
Effective Exchange ◽  
Main Determinants ◽  
Effective Exchange Rate

This paper investigates the sources of inflation across a sample of countries in the world. The data set covers around fifty nine countries using yearly data over the period from 1970 through 2007. The model is estimated using a panel model with a random effects specification. Results indicate that the main determinants of inflation for developing countries are different than those for developed countries. Our findings show that the main determinants of inflation for developed countries include government spending, money supply growth, world oil prices, interest rate, nominal effective exchange rate, and population. Whereas, sources of inflation for developing countries are estimated to include government spending, money supply growth, world oil prices, and the nominal effective exchange rate. Findings also report that there is no significant evidence for factors such as interest rate and population to affect the general price levels in developing countries.

scholarly journals PENGARUH KEBIJAKAN MONETER DAN FISKAL TERHADAP PENGANGGURAN DI INDONESIA

2021 ◽  
Vol 4 (1) ◽  
pp. 433-442
Author(s):  
Triyas Ayu Hadi Setiowati ◽  
Ris Yuwono Yudo Nugroho
Keyword(s):  
Monetary Policy ◽  
Money Supply ◽  
Impulse Response ◽  
Unemployment Rate ◽  
Government Spending ◽  
Time Series Data ◽  
Variance Decomposition ◽  
Series Data ◽  
Tax Revenue ◽  
The Impact

The purpose of this study is to analyze the impact of monetary policy as seen from the BI Rate and the money supply (M2, and fiscal policy as seen from government spending and tax revenue in influencing the unemployment rate in Indonesia. The approach used in this research is quantitative. The data used are the BI Rate, the money supply (M2), government spending, tax revenue and unemployment in the form of time series data in an annual form from 1995 to 2019. The method used in this study is the Vector Auto analysis model. Regression (VAR). The stages used in this research test are a stationarity test, optimum lag test, VAR stability test, impulse response test, and variance decomposition test. The results of the impulse response indicate that the unemployment variable responds most to the shock of the interest rate variable (monetary policy) compared to other variables. The results of variance decomposition indicate that the contribution given by the BI Rate to the unemployment rate is the most significant relative to the contribution given by the variable money supply (M2), government spending, and tax revenue

scholarly journals Multivariate Dynamic Co-integration and Causality Analysis between Inflation and its Determinants

2016 ◽  
Vol 8 (5(J)) ◽  
pp. 240-250
Author(s):  
Md. Sharif Hossain ◽  
Md. Thasinul Abedin
Keyword(s):  
Economic Growth ◽  
Money Supply ◽  
Government Spending ◽  
Time Series Data ◽  
Series Data ◽  
Value Addition ◽  
Speed Of Adjustment ◽  
Long Run ◽  
Short Run ◽  
Adf Test

This paper investigates the impacts of money supply, government expenditure, velocity, industry value addition and economic growth on inflation of Bangladesh using time series data from 1978-2014. The ADF test results suggest that the variables are of I(1). It is found that there exist five co-integration equations. The outcome of the Granger Causality test suggests the short-run unidirectional causality running from industrial value addition to money supply, from inflation, money supply, velocity, industrial value addition and economic growth to government spending. Bidirectional causality has been found between economic growth and industrial value addition. Finally, short-run and long-run effects of money supply, government spending, velocity, industry value addition and economic growth on inflation are estimated. It is found that the speed of adjustment for short-run to approach to the long-run equilibrium level is significant at any significance level. It has been found that it will take about 1.25 years for a complete convergence process to approach its equilibrium. Therefore, in case of any shock to the inflation equation, the speed of adjustment is significantly faster. It has also been found that the long-run effects of money supply and velocity have positive significant effects while the economic growth has significant negative effect on inflation in Bangladesh economy. It has been found that the long-run effects of money supply and velocity are more than short-run effects meaning that over the time more money supply and velocity increase the more and more inflation in Bangladesh but economic growth decreases the inflation.

scholarly journals Efektivitas Fiskal - Moneter: Strategi Pemulihan Ekonomi Provinsi Riau Dalam Menghadapi Era New Normal

2021 ◽  
Vol 11 (1) ◽  
pp. 67
Author(s):  
Dwi Widiarsih ◽  
Ranti Darwin ◽  
Khairi Murdy
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Money Supply ◽  
Government Spending ◽  
Empirical Test ◽  
Unit Root Test ◽  
Vector Error Correction ◽  
Augmented Dickey Fuller

This research use an empirical test of long-term balance and co-integration between macroeconomic variables, fiscal policy and monetary policy. Fiscal policy is represented by government spending variables, while monetary policy is represented by the money supply. This study uses the Vector Error Correction Model (VECM) method. The research variables are economic growth, government spending and the money supply. The research period uses the period 2010-2019. The data quality test used the unit root test with the Augmented Dickey Fuller test (ADF) method, to see the empirical data stationarity and the cointegration value of the variables. The research shows that the data is stationary in first difference. Based on the results of the VECM test, it can be concluded that there is a stable long-term relationship between variables and the research model. The results of data processing showed that the most effective policy for changing economic growth in Riau Province was fiscal policy, namely government spending. This can be seen from the contribution of fiscal policy to the variability of economic growth which is the largest compared to the contribution of monetary policy

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