Role of Some Monetary Indicators on Nepalese Economic Growth

Authors

  • Bashu Dev Dhungel Ratna Rajyalaxmi Campus, Tribhuvan University, Nepal

DOI:

https://doi.org/10.3126/hssj.v13i1.44545

Keywords:

broad money supply, GDP growth, error correction term, bank rate, co-integration

Abstract

This research paper attempts to examine the causal association between major’s Nepalese monetary factors and Gross Domestic Product growth from 1980–2019. To confirm the short-term and long-term contribution of monetary factors to Gross Domestic Product Growth, Johansen approach to cointegration and Error Correction Model has employed and the results have confirmed that the broad money supply and consumer price index positively and significantly affects Gross Domestic Product growth whereas bank rate is seemed to be negatively and significantly effect on Gross Domestic Product growth in Nepalese economy. Moreover, Error Correction coefficient term (-0.4) confirms the emergence of a nexus between the monetary related variables and Gross Domestic Product growth at 40% speed of adjustments towards the equilibrium.

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Author Biography

Bashu Dev Dhungel, Ratna Rajyalaxmi Campus, Tribhuvan University, Nepal

Associate Professor, Department of Economics

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Published

2021-08-01

How to Cite

Dhungel, B. D. (2021). Role of Some Monetary Indicators on Nepalese Economic Growth. Humanities and Social Sciences Journal, 13(1), 1–12. https://doi.org/10.3126/hssj.v13i1.44545

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Section

Articles