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Is inflation in Ghana a monetary phenomenon?
Addo, Grace Naa Kalei
ABSTRACT Inflation is a problematic macroeconomic factor that affects most economies, in-cluding Ghana. Inconsistent policies have made it difficult for policymakers to achieve target inflation rates, leading to negative impacts on living standards. Infla-tion is a key indicator of a country's economic performance, and Ghana has been severely impacted by excessive inflation. The aim of the research was to develop more accurate models for predicting inflation in Ghana by assessing various econ-ometric techniques and identifying key macroeconomic signs. Multiple Regression Analysis and Walk-through analysis were applied to secondary data obtained from Ghana to make inflation predictions. The findings revealed an inverse relationship between GDP growth and inflation over the long term, but a direct relationship in the short term. Government expenditure had a negative influence on inflation in the short term but a positive impact over the long term. Neither broad money growth nor real effective exchange rate had a significant impact on inflation. The study also revealed a substantial upward trend in broad money and significant influencing fac-tors in the BOG policy rate, inflation rate, and GDP growth rate. The real effective exchange rate and government expenditure had no significant influencing factors.
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Relantionship between Inflation and Exchange Rate in Ghana
Seth, Kofi Adu
This thesis was aimed at investigating the volatility and relationship between inflation rates and exchange rates in Ghana. The data for the study was obtained from the World Data Bank, the Bank of Ghana, and the Ghana Statistical Service. It covered a period from 1980 to 2016. The main variables were the real exchange rate and inflation. The software used to run the data was Stata. The study employed Vector Autoregressive (VAR) model. The VAR model was chosen by reason that the data set were integrated but not cointegrated. The study result shows that in the short-run, a percentage change in the variability of the real exchange rate induces 54% change in the variability of inflation rate. Again, a percentage change in the variability of real exchange rate induces 90% change in the variability of real exchange rate.
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Economic change in Russia: Oil dependency
Krupa, Mikuláš ; Kučerová, Irah (advisor) ; Parízek, Michal (referee)
This thesis concentrates on the case of Russian economy and assessment of its dependence on oil. Russia is often cited as an example of country suffering from resource curse as its natural wealth forms significant share of country's exports and revenues. Thesis will first concentrate on factors determining current state of Russian economy. Presence of the symptoms of Dutch disease in the Russian economy will be studied using the Vector error correction model (VECM) applied on the real effective exchange rate of country (REER). Thesis will also contain an assessment of Russian institutional environment to check for other symptoms of resource curse theory. Analysis of latest federal budget will be used to evaluate the sustainability of Russian federal finances. The thesis is concluded by discussion of results and possible paths of future development of Russian economy.
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Sources of Asymmetric Shocks: The Exchange Rate or Other Culprits?
Skořepa, Michal ; Komárek, Luboš
We analyze and quantify the determinants of asymmetric shocks showing up in the form of medium-term real exchange rate (RER) changes. First, we discuss sources of asymmetric shocks causing exchange rate variability and the role of the RER as a shock generator. Second, we use data for 21 advanced and late-transition economies to gauge the extent to which medium-term bilateral real exchange rate variability can be explained by various fundamental factors. Using Bayesian model averaging, we find that out of 22 factors under consideration, four types of dissimilarities within a given pair of economies are likely to be included in the true model: dissimilarities as regards (i) financial development, (ii) per capita income growth, (iii) central bank independence, and (iv) the structure of the economy. A regression based on these four factors indicates that these factors explain about one third of the behavior of the three-year RER variability for the whole sample and almost half of the behavior of the three-year RER variability for the RERs involving specifically the euro. The remaining part of the total variability represents an estimate of the influence of the exchange rate market itself (together with the influence of fundamental price level or nominal exchange rate determinants not captured by the regressors used).
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