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MONETARY POLICY TRANSMISSION MECHANISM IN MACROECONOMIC ACTIVITIES IN PAKISTAN WEALTH CHANNEL

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03 Pages : 20 - 32

http://dx.doi.org/10.31703/ger.2022(VII-II).03      10.31703/ger.2022(VII-II).03      Published : Jun 2022

Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)

Abstract

    This paper empirically analyzed the monetary policy transmission mechanism for wealth channels by applying Vector Auto Regressive (VAR) technique to time series data for the period of 1991 Q1 to 2018 Q4. Results are found significant. Variables included in the model follow the same direction as the theory suggests. Standard deviation shocks to each variable in variance decomposition results are bitterly transmitted. The performance of this channel on the biases of impulse responses and variance decomposition is better. Policy decisions related to high interest rates should be taken carefully. The level of savings is very poor. Low saving adversely affects investment and GDP. Therefore, better remedies are needed to capture the problem.

    Wealth, Monetary Policy, Transmission Mechanism, Channels

    (1) Haroon Khan
    Higher Education Department Khyber Pakhtunkhwa Pakistan.
    (2) Amjad Amin
    Assistant Professor, Department of Economics, University of Peshawar, KP, Pakistan.
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Cite this article

APA

    APA : Khan, H., & Amin, A. (2022). Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel). Global Economics Review, VII(II), 20 - 32. https://doi.org/10.31703/ger.2022(VII-II).03

CHICAGO

    CHICAGO : Khan, Haroon, and Amjad Amin. 2022. "Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)." Global Economics Review, VII (II): 20 - 32 doi: 10.31703/ger.2022(VII-II).03

HARVARD

    HARVARD : KHAN, H. & AMIN, A. 2022. Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel). Global Economics Review, VII, 20 - 32.

MHRA

    MHRA : Khan, Haroon, and Amjad Amin. 2022. "Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)." Global Economics Review, VII: 20 - 32

MLA

    MLA : Khan, Haroon, and Amjad Amin. "Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)." Global Economics Review, VII.II (2022): 20 - 32 Print.

OXFORD

    OXFORD : Khan, Haroon and Amin, Amjad (2022), "Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)", Global Economics Review, VII (II), 20 - 32

TURABIAN

    TURABIAN : Khan, Haroon, and Amjad Amin. "Monetary Policy Transmission Mechanism in Macroeconomic Activities in Pakistan (Wealth Channel)." Global Economics Review VII, no. II (2022): 20 - 32. https://doi.org/10.31703/ger.2022(VII-II).03