research paper money supply

• DOI: 10.30564/jesr.v4i4.3782
• Corpus ID: 243478361

The Impact of Money Supply on the Economy: A Panel Study on Selected Countries

• Javier de Oña García Matres , Tuan Viet Le
• Published in Journal of Economic Science… 30 October 2021

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An empirical investigation of the quantity theory of money in pakistan, macroeconomic impact on indonesia's economic growth, 20 references, money supply, inflation and economic growth in nigeria, m2 targeting, money demand, and real gdp growth in nigeria: do rules apply, long-run links among money, prices and output: worldwide evidence, money, income, prices, and interest rates, testing the long-run neutrality of money in a developing economy: the case of india, is inflation always and everywhere a monetary phenomenon, causality link between money, output and prices in malaysia: an empirical re-examination, money supply influencing on economic growth-wide phenomena of aec open region, interest rates and m2 in an error correction macro model, the quantity theory of money: evidence from the united states, related papers.

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Monetary Regimes, Money Supply, and the US Business Cycle since 1959

Mercatus Research Paper

71 Pages Posted: 8 Jan 2019 Last revised: 11 Jan 2019

Hylton Hollander

Stellenbosch University

Date Written: December 5, 2018

The monetary authority’s choice of operating procedure has significant implications for the role of monetary aggregates and interest rate policy on the business cycle. Using a dynamic general equilibrium model, we show that the type of endogenous monetary regime, together with the interaction between money supply and demand, captures well the actual behavior of a monetary economy—the United States. The results suggest that the evolution toward a stricter interest rate–targeting regime renders central bank balance-sheet expansions ineffective. In the context of the 2007–2009 Great Recession, a more flexible interest rate–targeting regime would have led to a significant monetary expansion and more rapid economic recovery in the United States.

Keywords: monetary regimes, monetary policy, money demand, US business cycle

JEL Classification: E32, E41, E42, E52, E58, N12

Suggested Citation: Suggested Citation

Hylton Hollander (Contact Author)

Stellenbosch university ( email ).

Matieland Stellenbosch, WesternCape 7600 South Africa +27218082478 (Phone)

HOME PAGE: http://www.ekon.sun.ac.za/staff/hollanderhylton

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Impact of money supply in different states of inflation and economic growth in south africa.

1. Introduction

2. literature review, 2.1. south african monetary policy review, 2.2. theoretical review, 2.3. empirical review, 3. methodology, 3.1. theoretical framework, 3.1.1. cobb–douglas, 3.1.2. the classical quantity theory of money, 3.2. model specification, 3.2.1. markov-switching dynamic regression, 3.2.2. time-varying vector autoregressive (ta-var), 5. conclusions, data availability statement, acknowledgments, conflicts of interest.

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Share and Cite

Buthelezi, E.M. Impact of Money Supply in Different States of Inflation and Economic Growth in South Africa. Economies 2023 , 11 , 64. https://doi.org/10.3390/economies11020064

Buthelezi EM. Impact of Money Supply in Different States of Inflation and Economic Growth in South Africa. Economies . 2023; 11(2):64. https://doi.org/10.3390/economies11020064

Buthelezi, Eugene Msizi. 2023. "Impact of Money Supply in Different States of Inflation and Economic Growth in South Africa" Economies 11, no. 2: 64. https://doi.org/10.3390/economies11020064

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The Impact of Money Supply on the Economy: A Panel Study on Selected Countries

This study investigates the impact of money supply on economic growth rate, inflation rate, exchange rate and real interest rate. We used a panel of 217 countries from 1960 to 2020 and four different models to address these questions. The empirical results support the quantity theory of money. In addition, the study found evidence for a negative relationship between real interest rate and inflation and between money supply and real interest rate. Finally, our results show that lagged money growth rate is positively correlated with GDP growth rate but money growth rate is negatively correlated with GDP growth rate.

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