scholarly journals The Relationship Between External Debt, Economic Growth, Unemployment and National Expenditure in Viet Nam

2018 ◽  
Vol 1 (2) ◽  
pp. p129
Author(s):  
Anh Tru Nguyen
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
External Debt ◽  
Viet Nam ◽  
Credit Growth ◽  
Short Run ◽  
The Government ◽  
The Relationship ◽  
Macroeconomic Stability

The article examines the relationship between external debt, economic growth, unemployment and national expenditure in Viet Nam between 1987 and 2016. We found that the influence of a variable on other variables varies in the short run. We found that there are directional relationships between GDP and external debt and GDP and national expenditure. We also found that there are directional relationships between unemployment and external debt, GDP, and national expenditure. Results addressed directional relationships between national expenditure and external debt and GDP. There are two co-integrations among variables. In order to sustain macroeconomic stability in Viet Nam, fiscal policy should be re-examined to meet large development needs and monetary policy should be tightened to reduce credit growth. Specifically, external debt should be effectively managed by the government because an increase in external debt leads to a decrease in GDP and a growth of unemployment. Moreover, GDP should be facilitated to reduce unemployment in the economy. Lastly, unemployment needs to be controlled because it generates a boom of national expenditure and vice versa.

scholarly journals Economic Growth, Policies and Influencing Factors: The Case of Albania

2016 ◽  
Vol 4 (1) ◽  
pp. 107
Author(s):  
Eleni Vangjeli ◽  
Anila Mancka
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Interest Rates ◽  
Empirical Analysis ◽  
Influencing Factors ◽  
Fiscal Policies ◽  
The Government ◽  
High Level ◽  
The Empirical Analysis

Monetary and fiscal policies are two policies that the government could use to keep a high level of growth, with a low inflancion. Fiscal policy has its initial impact on the stock market, while monetary policy in market assets. But, given that the goods and active markets are closely interrelated, both policies, monetary as well as fiscal have impact on the economy, increasing the level of product through the reduction of interest rates. In our paper we will show how functioning monetary and fiscal policies. But also in our paper we will analyze the different factors which have affected the economic growth of the country. The focus of our study is the graphical and empirical analysis of economic growth, policies and influencing factors. For the empirical analysis we have used data on the economic growth in Albania for 1996– 2014.

scholarly journals An econometric analysis of the effectiveness of fiscal and monetary policies in India

2021 ◽  
Author(s):  
Anand Nadar
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Money Supply ◽  
Series Data ◽  
Monetary Policies ◽  
Indian Economy ◽  
Long Run ◽  
Short Run ◽  
Bound Test

This study investigatesthe effectiveness of fiscal policy and monetary policy in India. We collected thetime series data for India ranging from 1960 to 2019 from World Development Indicator (WDI). Weapplied the bound test co-integration approach to check the long-run relationship between fiscalpolicy, monetary policy, and economic growth in the context of Indian economy. The short-run andlong-run effects of fiscal policy and monetary policy have been estimated using ARDL models. Theresults showed that there is a long-run relationship between fiscal and monetary policies witheconomic growth. The estimated short-run coefficients indicated that a few immediate short runimpacts of fiscal and monetary policies are insignificant. However, the short-run impacts becomesignificant as time passes. The long-run results suggested that the long-run impact of both fiscal andmonetary policies on economic growth are positive and significant. More specifically, the GDP levelincreases if the money supply and government expenditure increase (Expansionary fiscal andmonetary policies). On the other hand, the GDP level decreasesif the money supply and governmentexpenditure decrease (contractionary fiscal and monetary policies). Therefore, this studyrecommends to use expansionary policies to spur the Indian economy.

scholarly journals THE IMPACT OF MACROECONOMIC POLICY ON ECONOMIC GROWTH IN SUB-SAHARA AFRICAN COUNTRIES

2021 ◽  
Author(s):  
Ayana Workneh
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
National Income ◽  
Policy Coordination ◽  
Gross National Income ◽  
African Countries ◽  
The Government ◽  
The Impact ◽  
Panel Vector Autoregression

The prime purpose of this article was to investigate the monetary and fiscal policy interaction and their impact on economic growth in a panel of 35 sub-Saharan African economies from 1980 to 2018. To achieve this objective, the study employs a Panel Vector Autoregression (PVAR) estimation technique. Using a PVAR approach, we show that an expansionary fiscal policy through tax revenue and an unexpected expansionary monetary policy via broad money supply have a positive effect on gross national income, whereas an expansionary fiscal policy through the government spending have a contractionary impact on gross national income. We also find that an unexpected expansionary monetary policy via real exchange rate has no effect on gross national income. Finally, we show evidence that there is a negative and significant relationship between fiscal policy and monetary policy and thus supporting the need of policy coordination between fiscal and monetary policies. Therefore, to have continuous and sustainable economic growth, the coordination of monetary and fiscal policies is vital, and the lack of this coordination leads to a sharp downturn of overall economic performance, even can hurt the economy The empirical results also show that the variation in gross national income is more explained by fiscal policy variables than monetary policy variables which show fiscal policy is more effective than monetary policy in influencing gross national income.

scholarly journals Public Debt, Economic Growth and Fiscal Balance: Alternative Measures of Sustainability in the Indian Context

2018 ◽  
Vol 21 (3) ◽  
pp. 780-799
Author(s):  
Joydeb Sasmal ◽  
Ritwik Sasmal
Keyword(s):  
Economic Growth ◽  
Fiscal Policy ◽  
Public Debt ◽  
Indian Context ◽  
Increase With Increase ◽  
Fiscal Balance ◽  
Short Run ◽  
The Government ◽  
Net National Product ◽  
The Impact

This article has examined the impact of public expenditure on economic growth and viability of fiscal policy when the deficit in budget is financed by public borrowing. A number of alternative criteria have been used as indicators of solvency in fiscal balance. The study is based on the theoretical framework and supported by the results of time series analysis in the Indian context. It is found that the share of revenue expenditure (RE) of the government has significantly increased over time and many of the components of RE are non-developmental in nature. The article argues that if growth suffers, it will put adverse impact on fiscal balance. The ratio of gross fiscal deficit (GFD) to net national product (NNP) and growth of NNP are co-integrated, and the ratio is found to increase with increase in NNP indicating deterioration in fiscal balance. The increase in total expenditure of the government has caused rise of the ratio of revenue deficit to total spending. Interest payment on public debt has led to the increase of the ratio of GFD to income. These results are indicators of non-viability of fiscal policy in India at least in the short run.

scholarly journals Monetary Policy and Economic Growth: A Review of International Literature

2018 ◽  
Vol 7 (2) ◽  
pp. 123-137 ◽  
Author(s):  
Enock Nyorekwa Twinoburyo ◽  
Nicholas M. Odhiambo
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Financial Markets ◽  
Developing Economies ◽  
Developed Economies ◽  
Long Run ◽  
Wide Range ◽  
Short Run ◽  
Theoretical Evolution ◽  
The Relationship

Abstract This paper aims to survey the existing literature, both theoretical and empirical, on the relationship between monetary policy and economic growth. While there has been a wide range of studies on the existing relationship between monetary policy and economic growth, the nexus between the two remains inconclusive. This paper takes a comprehensive view of the theoretical evolution of the relationship and the respective recent empirical findings. Overall, this paper shows that the majority of findings support the relevancy of monetary policy in supporting economic growth, mainly in financially developed economies with fairly independent central banks. The relationship tends to be weaker in developing economies with structural weaknesses and underdeveloped financial markets that are weakly integrated into global markets. This paper concludes that monetary policy matters for growth both in the short-run and long-run despite the prevailing ambiguous relationship. The paper recommends intensive financial development measure for developing countries as well as structural reforms to address to supply side deficiencies.

scholarly journals Whether Fiscal Stance or Monetary Policy is Effective for Economic Growth in Case of South Asian Countries?

2008 ◽  
Vol 47 (4II) ◽  
pp. 791-799 ◽  
Author(s):  
Shahid Ali ◽  
Somia Irum ◽  
Asghar Ali
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Asian Countries ◽  
Policy Mix ◽  
Monetary Policies ◽  
Tax Rate ◽  
The Government ◽  
The Impact ◽  
Fiscal And Monetary Policy

Monetary policy and fiscal policy are sister strategies that can be used alone and in combination to direct the economic goals. In the literature relative efficacy of fiscal and monetary policy has been studied extensively. Friedman and Meiselman (1963), Ansari (1996), Reynolds (2000, 2001), Chari, et al. (1991, 1998), Schmitt and Uribe (2001a), Shapiro and Watson (1988), Blanchard and Perroti (1996), Christiano, et al. (1996), Chari and Kehoe (1998), Kim (1997), Chowdhury (1986, 1988), Chowdhury, et al. (1986), Weeks (1999), Feldstein (2002) and Cardia (1991) have examined the impact of fiscal and monetary policies on various economic aggregates. However, the bulk of theoretical and empirical research has not reached on conclusion concerning the relative power of fiscal and monetary policy to effect economic growth. Some researchers find support for the monetarist view, which suggests that monetary policy generally has a greater impact on economic growth and dominates fiscal policy in terms of its impact on investment and growth. [Friedman and Meiselman (1963); Ajaye (1974); Elliot (1975); Batten and Hafer (1983)], while other argued that fiscal stimulates are crucial for economic growth. [Chowdhury (1986); Olaloye and Ikhide (1995)], On the other hand, according to Cardia (1991) macroeconomic activities are largely explained by some other variables. The experiment of 1970s clearly demonstrates that a policy mix produced only stagflation. Some economist took keen interest in money by combining Keynesian neoclassical mixture which is called the “funnel” theory by James Tobin. The argument was that tax rate and money growth simultaneously leads to stagflation thus the Government could choose either fiscal or monetary policy stimulus which will enhance growth. [Reynolds (2001)].

scholarly journals External Debt, External Reserves, Debt Service Costs and Economic Growth: Implications for the Nigerian Transport Sector

2021 ◽  
Vol 12 (1) ◽  
pp. 182-191
Author(s):  
Osadume C. Richard ◽  
Edih University Ovuokeroye
Keyword(s):  
Economic Growth ◽  
External Debt ◽  
Negative Relationship ◽  
Debt Service ◽  
Transport Sector ◽  
Short Term ◽  
Key Sectors ◽  
The Government ◽  
The Relationship

Abstract The objective of the study presented in this article is to examine the relationship between external debt (EXDT), external reserves (EXRS), total debt service costs (TDS) and Nigeria’s economic growth (RGDP) and how these variables impact on the Nigerian transport economy employing profligacy theory. The study used secondary data for Nigeria for the period 1979 to 2019 obtained from the International Debt Office (WBG). The econometric techniques used include OLS, Granger causality and Engle-Granger cointegration at a 0.05 confidence level. The results show that EXDT has a statistically significant negative relationship with EXRS, with no statistically significant relationship existing with RGDP and TDS in the short term. All the variables showed significant cointegration over the long term, with the conclusion that the relationship between EXRS and EXDT is negatively significant in the short term, while the other variables are insignificant. The recommendations of the study include, that the government and monetary authorities should endeavour to reduce the creation of foreign debt for nonreproductive projects in key sectors due to its adverse effect on external reserves, and instead pursue aid, grants and domestic long-term loan options necessary for effective growth of the transport and other key sectors of the economy.

scholarly journals Monetary Policy and Private Sector Credit Interaction in Ghana

2020 ◽  
pp. 180-191
Author(s):  
Alice Constance Mensah ◽  
Ebenezer Okyere
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Private Sector ◽  
Error Correction ◽  
Money Supply ◽  
Long Run ◽  
Short Run ◽  
The Government

Using a series of econometric techniques, the study analysed interaction between monetary policy and private sector credit in Ghana. This study made use of monthly dataset spanning January 1999 to December 2019 of credit to the private sector (PSC) and broad money supply (M2). The results reveal that there exists cointegration, a long run stationary relation between monetary policy and private sector credit. This implies, increases in credit should prompt long-term increases in monetary policy. It is not surprising that growth in the private sector might have a stronger effect on monetary policy. The Error Correction Test is statistically significant and that all the variables demonstrate similar adjustment speeds. This implies that in the short run, both money supply and credit are somewhat equally responsive to their last period’s equilibrium error. There is unidirectional causation from private sector credit to monetary policy. It can be said that, there is an interaction between money supply and private sector credit. Thus, credit to private sector holds great potential in promoting economic growth. It can be recommended to the government to increase the credit flow to the private sector because of its strategic importance in creating and generating growth of the economy.

scholarly journals An econometric analysis of the effectiveness of fiscal and monetary policies in India

2021 ◽  
Author(s):  
Anand Nadar
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Fiscal Policy ◽  
Government Expenditure ◽  
Series Data ◽  
Monetary Policies ◽  
Long Run ◽  
Development Indicator ◽  
Short Run ◽  
Bound Test

This study investigate the effectiveness of fiscal policy and monetary policy in India. We collected thetime series data for India ranging from 1960 to 2019 from World Development Indicator (WDI). Weapplied the bound test to check the long-run relationship between fiscal policy, monetary policy andeconomic growth. The short-run and long-run effects of fiscal policy and monetary policy have beenestimated using ARDL models. The results showed that there is a long-run relationship between fiscaland monetary policies with economic growth. The estimated short-run coefficients indicated that afew immediate short run impact of fiscal and monetary policies are insignificant. However, the shortrun impacts become significant as time passes. The long-run results suggested that the long-runimpact of both fiscal and monetary policies on economic growth are positive and significant. Morespecifically, the GDP level increases if the money supply and government expenditure increase(Expansionary fiscal and monetary policies). On the other hand, the GDP level decrease if the moneysupply and government expenditure decrease (contractionary fiscal and monetary policies).Therefore, this study recommend to use expansionary policies to spur the Indian economy.

Electricity consumption and economic growth in ASEAN

2017 ◽  
Vol 5 (2) ◽  
pp. 16
Author(s):  
Ahmad Ghazali Ismail ◽  
Arlinah Abd Rashid ◽  
Azlina Hanif
Keyword(s):  
Economic Growth ◽  
Energy Use ◽  
Electricity Consumption ◽  
Panel Estimation ◽  
Real Gdp ◽  
Long Run ◽  
Bidirectional Relationship ◽  
Short Run ◽  
Using Data ◽  
The Relationship

The relationship and causality direction between electricity consumption and economic growth is an important issue in the fields of energy economics and policies towards energy use. Extensive literatures has discussed the issue, but the array of findings provides anything but consensus on either the existence of relations or direction of causality between the variables. This study extends research in this area by studying the long-run and causal relations between economic growth, electricity consumption, labour and capital based on the neo-classical one sector aggregate production technology mode using data of electricity consumption and real GDP for ASEAN from the year 1983 to 2012. The analysis is conducted using advanced panel estimation approaches and found no causality in the short run while in the long-run, the results indicate that there are bidirectional relationship among variables. This study provides supplementary evidences of relationship between electricity consumption and economic growth in ASEAN.

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