The relationship between monetary stability and central bank independence: The case of Azerbaijan
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Author(s)Ilknur Tanriverdi ,Farid JabiyevLink to ORCID Index: https://orcid.org/0000-0002-6675-0264
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Yuriy BilanLink to ORCID Index: https://orcid.org/0000-0003-0268-009X
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Mayis AzizovLink to ORCID Index: https://orcid.org/0000-0003-1142-846X
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Elsevar Ibadov
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DOIhttp://dx.doi.org/10.21511/bbs.19(1).2024.07
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Article InfoVolume 19 2024, Issue #1, pp. 74-85
- 645 Views
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118 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
The independence of the central bank is one of the most important factors for effective monetary policy. Central bank independence is closely related to monetary stability, which is an important part of monetary policy. In this study, the purpose of the analysis is to understand whether monetary stability functions effectively for central bank independence in Azerbaijan using the vector autoregression method. In addition, the Granger Causality test was conducted to empirically investigate how central bank independence affects the provision of monetary stability in the economy of Azerbaijan over the data period from 1996 to 2022. In this framework, indices or variables are the exchange rate stability index (ERS) in 1996–2022, the level of monetary independence index (MI) in 1996–2020, taken from the “trilemma indexes”, which are defined as the consumer price index (CPI) in 1996–2022, and the broad money supply (M2) in 1996–2022. The findings of the study show that the independence of the central bank has a positive effect on the monetary stability of the Azerbaijani economy.
- Keywords
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JEL Classification (Paper profile tab)E52, E58, P44
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References49
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Tables6
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Figures1
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- Figure 1. Inverse roots
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- Table 1. Unit root test results
- Table 2. Lag interval tests
- Table 3. LM test results
- Table 4. White test results
- Table 5. Normal distribution test results
- Table 6. Granger causality test results
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The impact of external factors on the monetary stability in Jordan for the period 1990–2015
Banks and Bank Systems Volume 14, 2019 Issue #1 pp. 29-41 Views: 947 Downloads: 222 TO CITE АНОТАЦІЯThis study aimed to examine the impact of external factors (external grants and aid, external public debt, remittances of Jordanians labor abroad and external shocks) on the efficiency of the monetary policy, which aims at achieving monetary stability through influencing inflation rates in Jordan during the period 1990–2015, by using standard regression equation estimated by the ordinary least squares (OLS). The findings of the study showed a statistically significant impact at 1% of each of the external grants and aid, and remittances of Jordanians labor abroad on the efficiency of monetary policy through targeting inflation rates in Jordan. As to the variables of external public debt and external shocks, the findings showed a weak impact, which was not statistically significant at a reasonable level, on the efficiency of monetary policy. The researchers recommended that decision-makers pay further attention to the vital role of the remittances of the Jordanians labor abroad, which is one of the main bases of the Jordanian economy. This is due to its crucial impact on the Jordanian economy.
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Financial factors for restraining the underground economy: case of Ukraine
Oleg Pidkhomnyi ,
Mariya Rubakha
doi: http://dx.doi.org/10.21511/ed.19(2).2020.01
The underground economy in Ukraine is one of the major obstacles on the way to accelerative economic growth and European integration processes. The high level of undergrounding leads to the weakening of the regulatory impact of fiscal and monetary policy instruments on the development of the national economy. Against this background, the financial and economic processes undergrounding is a major challenge and a top priority problem for Ukraine today. The article aims to determine the financial levers to restrict economy’s undergrounding and justify measures to reduce the risk of undergrounding by certain monetary and budgetary parameters regulation. The research methodological basis is the methods of scientific abstraction, induction, deduction, generalization, logical method. For analytical calculations there are used coefficient analysis, mathematical methods, including correlation analysis, comparison and grouping methods, synthesis, tabular and graphical methods. The Ukraine underground economy is selected as the study object example with this methods’ system using. Therefore the study, based on the calculation of the Fechner correlation coefficient, has revealed the presence, closeness and direction of the relationship between monetary indicators (values of changes in monetary aggregates M0, M2 and M3, CPI, changes in the official hryvnia rate to the US dollar), budgetary parameters (changes in intergovernmental transfers, changes in external public debt, taking into account inflation) and the underground economy level. Thus, according to the results of the analysis, the main directions of the relevant regulatory bodies influence on the national economy unshadowing have been determined.
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Multiplier effect of factors influencing the inflation processes in Ukraine in 2014-2018
Inflation is a complex economic phenomenon in terms of form, development and consequences. Inflation undermines the possibilities of the economic regulation mechanism, nullifies the efforts to carry out structural changes and restore destroyed proportions. The aim of the article is to construct a regression model of the factors influencing the inflation processes in Ukraine and determine the multiplier effect of each factor on the resulting indicator. The object of the research is the inflation processes in Ukraine in 2014-2018. Mathematical modelling methods have been used in the base of the analysis. A correlation-regression analysis of inflation factors in Ukraine was conducted in the article. As a result of research, the presence of inflation of propositions (charges) in Ukraine is well-proven, that was conditioned in a greater degree by the increase of cost of commodities and services of natural monopolies, devaluation of national currency and increase in average salary. The value of inflation multipliers of these parameters and their functional influence on the cost-of-living-index have been determined. The dependence of the increase of the average salary is set on the change of the level of the minimum one has been determined. The most optimal directions of stimulant fiscal and monetary politics for the increase of the efficiency of government regulation of inflationary processes in Ukraine have been offered.
