Preferencje help
Widoczny [Schowaj] Abstrakt
Liczba wyników
2023 | 11 | nr 1 | 165--177
Tytuł artykułu

Has Policy Rate Been an Effective Tool in Taming Inflation? : A Sub-Saharan African Perspective.

Warianty tytułu
Języki publikacji
This paper explores the effectiveness of monetary policy rate as a tool to tame inf lation in sub Saharan Africa (SSA) using the system GMM estimator and other econometric approaches. Financial data (unconsolidated) from Orbis for the period 2011-2018 was used for the purpose of this study. We find that expected inf lation, GDP growth rate, unemployment, the exchange rate, broad money supply, and policy rate significantly inf luence the inf lation rate in SSA. The result clearly points to the fact that targeting inf lation using monetary policy rate has not been an effective tool for taming inf lation in SSA. To the extent that the baseline result indicates the monetary policy rate has no substantial impact on inf lation in the region, there is therefore the need to re-evaluate monetary policy design that could help control inf lation. In terms of potential policy implications of this paper based on our results, policy makers or monetary authorities should not arbitrarily raise policy rate to control inf lation but should also consider other monetary policies such as money supply. The paper concludes that the credibility and accountability of the monetary policy authorities should be improved by setting targets appropriate to their institutional capacity and meeting them.(original abstract)
Opis fizyczny
  • Mendel University, Czech Republic
  • Mendel University, Czech Republic
  • Andrle, M., Berg, A., Berkes, E., Morales, R. A., Portillo, R., Vlcek, J. (2018), Do Money Targets Matter for Monetary Policy in Kenya? Monetary Policy in SubSaharan Africa, 309-335. DOI: 10.1093/oso/9780198785811.003.0016
  • Arellano, M., Bond, S. (1991), Some tests of specifi-cation for panel data: Monte Carlo evidence and an application to employment equations. The Review of Economic Studies, 58(2), 277-297. DOI: 10.2307/2297968
  • Afonso, A., Alves, J., Balhote, R. (2019), Interactions between monetary and fiscal policies, Journal of Applied Economics, 22(1), 132-151. DOI: 10.1080/15140326.2019.1583309.
  • Amato, J.D, Gerlach, S. (2002), Inflation targeting in emerging market and transition economies: Lessons after a decade, European Economic Review, 46(4-5), 781-790. DOI: 10.1016/S0014-2921(01)00213-6
  • Aryeetey, E. Fosu, A., Bawumia, M. (2002), Explain-ing African economic growth performance: The case of Ghana.
  • Asongu, S.A. (2014), Correcting inflation with financial dynamic fundamentals: which adjustments matter in Africa?, Journal of African Business, 15(1), 64-73. DOI: 10.1080/15228916.2014.881231
  • Barišić, P., Kovač, T. (2022), The The effectiveness of the fiscal policy response to COVID-19 through the lens of short and long run labor market effects of COVID-19 measures, Public Sector Economics, 46(1), 43-81. DOI: 10.3326/pse.46.1.2
  • Batarseh, A. (2021), The nature of the relationship between the money supply and inflation in the Jordanian economy (1980-2019), Banks and Bank Systems, 16(2), 38-46. DOI: 10.21511/bbs.16(2).2021.04.
  • Bernanke, B.S., Boivin, J., Eliasz, P. (2005), Measuring the effects of monetary policy: a factor-augment-ed vector autoregressive (FAVAR) approach, The Quarterly Journal of Economics, 120(1), 387-422. DOI: 10.3386/w10220
  • Bonga-Bonga, L., Kabundi, A. (2011), Monetary pol-icy action and inflation in South Africa: an em-pirical analysis, African Finance Journal, 13(2), 25-37.
  • Cavoli, T., Gopalan, S., Rajan, R.S. (2023), Financial Inclusion, Inflation Targeting and the Policy Rate: Evidence from Emerging Economies, SSRN Electronic Journal [Preprint]. DOI: 10.2139/ssrn.4379912.
  • Christiano, L.J., Eichenbaum, M., Evans, C.L. (2005), Nominal rigidities and the dynamic effects of a shock to monetary policy, Journal of Political Economy, 113(1), 1-45. DOI: 10.1086/426038
  • Cioran, Z. (2014), Monetary policy, inflation and the causal relation between the inflation rate and some of the macroeconomic variables, Procedia Economics and Finance, 16, 391-401.
  • Emerenini, F.M., Eke, C.N. (2014), The impact of monetary policy rate on inflation in Nigeria, Journal of Economics and sustainable Development, 5(28), 146-153.
  • Enejoh, S.Y, Tsauni, A.M. (2017), An Analytical Study of the Impact of Inflation on Economic Growth in Nigeria (1970-2016), International Journal of Academic Research in Accounting, Finance and Management Sciences, 7(4), 110-120. DOI: 10.6007/IJARAFMS/v7-i4/3438.
  • Gbadebo, A.D., Mohammed, N. (2015), Monetary policy and inflation control in Nigeria, Journal of Economics and Sustainable Development, 6(8), 108-115.
  • Hendry, D.F. (2001), Modelling UK inflation 1875-1991, Journal of Applied Econometrics, 16(3), 255-275.
  • Hossain, T., Islam, N. (2013), An economic analysis of the determinants of inflation in Bangladesh, The International Journal of Social Sciences, 11(1), 29-36.
  • Korkmaz, S., Abdullazade, M. (2020), The Causal Relationship between Unemployment and Inflation in G6 Countries, Advances in Economics and Business, 8(5), 303-309. DOI: 10.13189/aeb.2020.080505.
  • Koulakiotis, A., Lyroudi, K., Papasyriopoulos, N. (2012), Inflation, GDP and Causality for European Countries, International Advances in Economic Research, 18(1), 53-62. DOI: 10.1007/s11294-011-9340-1.
  • Mohanty, M.S., Klau, M. (2004), Monetary Policy Rules in Emerging Market.
  • Monfared, S.S, Akın, F. (2017), The Relationship Between Exchage Rates and Inflation: The Case of Iran, European Journal of Sustainable Development, 6(4). DOI: 10.14207/ejsd.2017.v6n4p329.
  • Olugbenga Adaramola, A., Dada, O. (2020), Impact of inflation on economic growth: evidence from Nigeria, Investment Management and Financial Innovations, 17(2), 1-13. DOI: 10.21511/imfi.17(2).2020.01.
  • Savvides, A. (1998), Inflation and monetary policy in selected West and Central African countries, World Development, 26(5), 809-827.
  • Semuel, H., Nurina, S. (2014), Analysis of the effect of inflation, interest rates, and exchange rates on Gross Domestic Product (GDP) in Indonesia. Petra Christian University.
  • Smets, F., Wouters, R. (2003), An estimated dynamic stochastic general equilibrium model of the euro area, Journal of the European Economic Association, 1(5), 1123-1175. DOI: 10.1162/154247603770383415
  • Taylor, JB. (1993), Discretion versus policy rules in practice, Carnegie-Rochester Conference Series on Public Policy, 39, 195-214. DOI: 10.1016/0167-2231(93)90009-L
  • World Economic Outlook, October 2022: Countering the Cost-of-Living Crisis (2022), Available at: (Accessed: 6 February 2023).
Typ dokumentu
Identyfikator YADDA

Zgłoszenie zostało wysłane

Zgłoszenie zostało wysłane

Musisz być zalogowany aby pisać komentarze.
JavaScript jest wyłączony w Twojej przeglądarce internetowej. Włącz go, a następnie odśwież stronę, aby móc w pełni z niej korzystać.