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Monetary policy and economic growth : lessons from East African countries

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dc.contributor.advisor Odhiambo, Nicholas M. en
dc.contributor.author Nyorekwa, Enock Twinoburyo
dc.date.accessioned 2019-04-24T15:13:49Z
dc.date.available 2019-04-24T15:13:49Z
dc.date.issued 2107-07
dc.identifier.citation Nyorekwa, Enock Twinoburyo (2107) Monetary policy and economic growth : lessons from East African countries, University of South Africa, Pretoria, <http://hdl.handle.net/10500/25403>
dc.identifier.uri http://hdl.handle.net/10500/25403
dc.description.abstract This study empirically examines the impact of monetary policy on economic growth in three East African countries (Uganda, Kenya and Tanzania). The role of monetary policy in promoting economic growth remains empirically an open research question, as both the empirical and theoretical underpinnings are not universal, and the results remain varying, inconsistent, and inconclusive. This study may be the first of its kind to examine in detail the impact of monetary policy on economic growth in Uganda, Kenya and Tanzania – using the autoregressive distributed lag (ARDL) bounds-testing approach. This study used two proxies of monetary policy, namely, money supply and interest rate, to examine this linkage. The results were found to differ from country to country and over time. The Uganda empirical results reveal that money supply has a positive impact on economic growth, both in the short run and in the long run. However, interest rate was found to have a positive impact on economic growth only in the short run. In the long run, interest rate has no significant impact on economic growth. In Kenya, both short-run and long-run empirical results support monetary policy neutrality, implying that monetary policy has no effect on economic growth – both in the short run and in the long run. The results from Tanzania also reveal no impact of monetary policy on economic growth in the long run – irrespective of the proxy used to measure monetary policy. However, the short-run results only reveal no impact of monetary policy on economic growth only when the interest rate is used as a proxy for monetary policy. When money supply is used to measure monetary policy, a negative relationship between monetary policy and economic growth is found to dominate. Overall, the study finds that monetary policy is only relevant for economic growth in Uganda and only when money supply is used as monetary policy variable. Therefore this study recommends a money supply based monetary policy framework for Uganda. The study findings also suggest that monetary policy may not be a panacea for economic growth in Kenya and Tanzania. en
dc.format.extent 1 online resource (xv, 227 leaves) : illustrations (some color) en
dc.language.iso en en
dc.subject Monetary policy en
dc.subject Money supply en
dc.subject Interest rate en
dc.subject ARDL bounds testing approach en
dc.subject Cointegration en
dc.subject Uganda en
dc.subject Kenya en
dc.subject Tanzania en
dc.subject Long run en
dc.subject Short run en
dc.subject Economic growth en
dc.subject.ddc 332.409676
dc.subject.lcsh Monetary policy -- East, Africa en
dc.subject.lcsh Economic development -- Africa, East en
dc.subject.lcsh Africa, East -- Economic conditions en
dc.title Monetary policy and economic growth : lessons from East African countries en
dc.type Thesis en
dc.description.department Economics en
dc.description.degree M. Com. (Economics)


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