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An Empirical Evaluation of Monetary and Fiscal Policy Effects in Bangladesh

Publication | August 2019
An Empirical Evaluation of Monetary and Fiscal Policy Effects in Bangladesh

This working paper explores the interaction of monetary and fiscal policies in spurring economic growth in Bangladesh.

Macroeconomic policy management is crucial for attaining sustainable economic growth with a stable a rate of inflation. In this working paper, monetary and fiscal policies in Bangladesh and their effectiveness in achieving sustainable growth and price stability are examined. It concludes that Bangladesh should focus on a combination of expansionary monetary policies and restrictive fiscal policies as the most beneficial approach.

Contents 

  • Introduction
  • Brief Description of Some Basic Macroeconomic Indicators of Bangladesh
  • Brief Treatise on Theoretical and Empirical Literature
  • Construction of the Structural Vector Autoregressive Model
  • Identification of the Structural Shocks
  • Empirical Models and Identification Issues
  • Data and Model Estimation
  • Impulse Response Functions
  • Conclusion
  • Appendixes