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Title Impact of Monetary Policy on Socio-Economic Indicators of South Asian Countries: An Empirical Analysis.

Author(s) Ms. Aysha Naeem

Abstract The issue of unemployment, poverty and income inequality is gaining traction on a daily basis, both nationally and internationally. Despite extensive research into how to combat this threat, it appears that little progress has been made. An economy's growth may be impeded due to societal challenges such as poverty and income inequality. Many experts believe that monetary variables such as the money supply and interest rate have no significant economic impact. Empirical evidence shows a significant association between monetary policy and socio-economic indices such as poverty, inequality, and unemployment. Poverty, income inequality and unemployment are used as dependent variables. Money supply, interest rate, exchange rate and total reserve are taken as explanatory variables. The policy variables have significant relation with the dependent variables, except poverty is not influenced by the total reserve. The data for these countries are taken from World Development Indicators and International Financial statistics from 1990 to 2020. The Panel ARDL Cointegration (Pedroni) and Pooled Mean Group explore the relationship between monetary policy and socio-economic variables. From Pedroni Cointegration test shows that there is a long Run relationship between monetary variables and socio-economic variables. Pooled Mean Group explore the relationship among variables in the short run and long run. From Pooled Mean Group has explore value the of coefficients. The results support the significant relationship between monetary and socio-economic variables in the long and short run. According to the findings, central banks should assess the socioeconomic impact of monetary policy before implementing it. This study recommended that any country's central bank supply a limited amount of money which affects poverty, income inequality and unemployment significantly because money supply not only impacts these socio-economic variables but also affects the policy variables. So, it is advised that monetary authorities assess the implications of monetary policy before implementing policy

Type Thesis/Dissertation

Faculty Management Sciences

Department Economics

Language English

Publication Date 2023-03-16

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