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Impact of Macroeconomic Variables on Economic Growth: Bangladesh Perspective

Author

Listed:
  • A H M Yeaseen Chowdhury

    (Department of Business Administration-General, Bangladesh University of Professionals, Mirpur Cantonment, Dhaka 1216)

  • Md. Kaysher Hamid

    (Department of Business Administration-General, Bangladesh University of Professionals, Mirpur Cantonment, Dhaka 1216.)

  • Rowshonara Akter Akhi

    (Department of Finance & Banking, Jahangirnagar University Savar, Dhaka 1342.)

Abstract

The impact of macroeconomic variables on the economic growth of Bangladesh is investigated in this study by considering GDP growth (GDP) as the representative of economic growth. In addition, inflation (INF), real interest rate (INT), exchange rate (EXR), and household consumption expenditures growth (HCE) are selected to represent the macroeconomic variables for the period of 1987-2015. Correlation and multiple regression analysis are conducted to evaluate the data. In correlation analysis, it is found that GDP has positive correlation with all the variables except INT. In regression analysis, GDP is selected as the dependent variable and INF, INT, EXR, and HCE are considered as the independent variables. It is observed that the independent variables explained 75.60% of the variability of GDP and the relationship is also found statistically significant at 95% confidence level. Therefore, this study has concluded that macroeconomic variables have significant effect on the economic growth of Bangladesh.

Suggested Citation

  • A H M Yeaseen Chowdhury & Md. Kaysher Hamid & Rowshonara Akter Akhi, 2019. "Impact of Macroeconomic Variables on Economic Growth: Bangladesh Perspective," Information Management and Computer Science (IMCS), Zibeline International Publishing, vol. 2(2), pages 19-22, October.
    • Handle: RePEc:zib:zbimcs:v:2:y:2019:i:2:p:19-22
    DOI: 10.26480/imcs.02.2019.19.22
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    References listed on IDEAS

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    1. João R. Faria & Francisco Galrão Carneiro, 2001. "Does High Inflation Affect Growth in the Long and Short Run?," Journal of Applied Economics, Universidad del CEMA, vol. 4, pages 89-105, May.
    2. Ziaur Rahman, 2014. "Inflation and Economic Growth in Bangladesh: An Empirical Analysis by Using VAR Model," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 4(8), pages 404-420.
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