Monetary Transmission Mechanism and Macroeconomy in Pakistan
Journal Title: Pakistan Journal of Economic Studies - Year 2022, Vol 5, Issue 1
Abstract
Monetary policy is considered a vital policy to manage aggregate demand. The main purpose of the analysis is to comprehend the accessibility of channels of the monetary transmission mechanism and to determine the basic monetary channel of the transmission mechanism for Pakistan. Thestudyhas appliedvector autoregressions, impulse response function and variance decompositionand used time-series data from 1975to 2015 to validate theinterest rate channel, asset price channel,credit channelandexchange rate channel. The findings of the study show that all the channels are vital channels of the monetary transmission mechanismin Pakistan.
Authors and Affiliations
Rana Zafar Hayat, Muhammad Ramzan Sheikh, Fozia Latif Gill
Keywords
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