The Effects of Money Supply on Inflation in Tanzania
James Ezekiel Mbongo,
Felician Mutasa,
Robert Ebihart Msigwa
Issue:
Volume 3, Issue 2, April 2014
Pages:
19-26
Received:
11 May 2014
Accepted:
14 June 2014
Published:
30 June 2014
DOI:
10.11648/j.eco.20140302.11
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Abstract: This paper examines the effects of money supply on inflation in Tanzania. This study uses secondary data extracted from two sources, namely; the National Bureau of Statistics (NBS) and Central Bank of Tanzania (BoT), where all variables employed in the analysis are extracted. The study applies OLS, VAR and ECM technique to examine the effect of selected variables on inflation in Tanzania. OLS and ECM results show that money supply and exchange rate have significant impact on inflation in the short and long run. Further, VAR findings indicate that the current inflation can be influenced by the past state inflation. Therefore, the government of Tanzania is recommended to impose tight monetary policies and expand the proportion of money in the economy from informal to formal transaction. The successful implementation of the suggested indicators to evaluate the inflation in the country will help to cure the instability of inflation, in turn will direct the economy of the country to preferable level.
Abstract: This paper examines the effects of money supply on inflation in Tanzania. This study uses secondary data extracted from two sources, namely; the National Bureau of Statistics (NBS) and Central Bank of Tanzania (BoT), where all variables employed in the analysis are extracted. The study applies OLS, VAR and ECM technique to examine the effect of sel...
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The Role of Mineral and Coal Mining on Interregional Convergence-Divergence Economic Trend in Indonesia
Ukar Wijaya Soelistijo,
La Ode Aswandi,
Marwan Zam Mili
Issue:
Volume 3, Issue 2, April 2014
Pages:
27-42
Received:
26 June 2014
Accepted:
8 July 2014
Published:
20 July 2014
DOI:
10.11648/j.eco.20140302.12
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Abstract: Within the last 35 years of 1975-2010 it was shown that within 1975-2000 the trend of convergence of economy between the provincial index of gross regional domestic product (GRDP) per capita with the national index of gross domestic product (GDP) per capita figured out by the ratio of the GRDP per capita of the richest province to the poorest province equaled 21 to 25 in 1975 toward around 12 in 2000, even though on the post 2000 the provinces which were before 2000 under the national GDP per capita index (<100) declining and lesser. The provinces which have reached the points of convergence by the year of 2000 are Aceh, North Sumatera, West Sumatera, South Sumatera, East Java, Central Kalimantan, South Kalimantan and Bali. It is indicated that within the next 30 years the several other provinces which could reach the points of convergence are West Java, Central Java, DI Yogyakarta, West Kalimantan, Riau, Papua and East Kalimantan. However, the other several provinces which are not fully convergent in the meaning of almost consistently existing above the national GDP per capita (what so called the ‘surplus’ provinces), are Aceh, DKI Jakarta, and Bali. Moreover, on the other side, several provinces with GRDP per capita which consistently exist below the national GDP per capita (what so called the ‘minus’ provinces) with the downward sloping regression or with the gently upward sloping regression. Toward achieving points of economic convergence, those ‘minus’ provinces have to trigger their potential prime sectors, which have high economic multipliers.In generating their regional income, it is shown that almost all the provinces of Indonesia still rely on the primary sectors such as mineral and agriculture, with the consequences of low added value. It is expected that mineral and coal and its downstream industries could be able to support the ‘minus’ regions to converge to the national index. Augmenting the regional economic growth, the regions should develop the secondary and services industry which have high value-added multiplier to extend the across-regional trade as well as between the regions in the country with the neighbors’ regions through subregional economic cooperation. Methodology applied in this study is based on regional economic modeling and observation.
Abstract: Within the last 35 years of 1975-2010 it was shown that within 1975-2000 the trend of convergence of economy between the provincial index of gross regional domestic product (GRDP) per capita with the national index of gross domestic product (GDP) per capita figured out by the ratio of the GRDP per capita of the richest province to the poorest provi...
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