Advanced Search
MyIDEAS: Login

Monetary Neutrality in the Nepalese Economy during 1975-2008

Contents:

Author Info

  • Mukesh Khanal

    ()
    (Institute for Integrated Development Studies (IIDS), Kathmandu)

Registered author(s):

    Abstract

    One of the methods of measuring the effectiveness of monetary policies is via inspection of monetary neutrality in the economy. It is a concept from classical economics and it suggests that changes in nominal variables do not have any impact on real variables. This paper studies the presence or absence of effective monetary policy in Nepal between 1975 and 2008 by observing money supply (nominal side), and real GDP (real). Results suggest that an increase in money supply immediately lowers the real GDP in the short run, but has no effect on real GDP in the long run. This evidence suggests that Nepal Rastra Bank’s monetary policies between 1975 and 2008 may have been counter-productive in the short-run, but they were effective for long-run growth and stability of the Nepalese economy.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.nrb.org.np/ecorev/pdffiles/vol23-1_art5.pdf
    Download Restriction: no

    Bibliographic Info

    Article provided by Nepal Rastra Bank, Research Department in its journal NRB Economic Review.

    Volume (Year): 23 (2011)
    Issue (Month): 1 (April)
    Pages: 71-91

    as in new window
    Handle: RePEc:nrb:journl:v:23:y:2011:i:1:p:71-91

    Contact details of provider:
    Email:
    Web page: http://www.nrb.org.np/ecorev/
    More information through EDIRC

    Related research

    Keywords:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Elliott, Graham & Rothenberg, Thomas J & Stock, James H, 1996. "Efficient Tests for an Autoregressive Unit Root," Econometrica, Econometric Society, vol. 64(4), pages 813-36, July.
    2. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-38, July.
    3. Jacobson, Tor & Jansson, Per & Vredin, Anders & Warne, Anders, 1999. "A VAR Model for Monetary Policy Analysis in a Small Open Economy," Working Paper Series 77, Sveriges Riksbank (Central Bank of Sweden).
    4. Lucas, Jr., Robert E., 1995. "Monetary Neutrality," Nobel Prize in Economics documents 1995-1, Nobel Prize Committee.
    5. Ryuzo Miyao, 2004. "Use of Money Supply in the Conduct of Japan's Monetary Policy: Reexamining the Time Series Evidence," Discussion Paper Series 163, Research Institute for Economics & Business Administration, Kobe University.
    6. Cripps, Francis, 1977. "The Money Supply, Wages and Inflation," Cambridge Journal of Economics, Oxford University Press, vol. 1(1), pages 101-12, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:nrb:journl:v:23:y:2011:i:1:p:71-91. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dr. Bishnu Prasad Gautam).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.