The impact of interest rate movement on consumption and output
Author
Source
Journal of Faculty of Politics and Economics
Issue
Vol. 2020, Issue 7 (31 Jul. 2020), pp.1-29, 29 p.
Publisher
Beni-Suef University Faculty of Politics and Economics
Publication Date
2020-07-31
Country of Publication
Egypt
No. of Pages
29
Main Subjects
Economy and Commerce
Political Sciences
Topics
Abstract EN
Interest rate is considered one of the most important tools of monetary policy in Egypt, and it is the most used to maintain price stability and tackle inflation, here we study its effect on consumption and income in an econometric technique.
This research is concerned with the study of the impact of interest rate shocks as an indicator of monetary policy on household consumption and Income in Egypt during the period from 1980 to 2018.
The research applies the quantitative analysis approach and uses the econometric model to deduce results and uses a Small Structural Vector Autoregressive Model (SVAR).
The research concludes that one standard deviation shock in interest rate shrinks consumption, but this very small and fast decrease is almost insignificant, while income initially increases in response to this positive shock.
On the other hand, a negative shock in consumption causes a reduction in interest rate.
the research also indicated a mutual relationship between consumption and income
American Psychological Association (APA)
Abd al-Jani, Muhammad. 2020. The impact of interest rate movement on consumption and output. Journal of Faculty of Politics and Economics،Vol. 2020, no. 7, pp.1-29.
https://search.emarefa.net/detail/BIM-1260960
Modern Language Association (MLA)
Abd al-Jani, Muhammad. The impact of interest rate movement on consumption and output. Journal of Faculty of Politics and Economics No. 7 (Jul. 2020), pp.1-29.
https://search.emarefa.net/detail/BIM-1260960
American Medical Association (AMA)
Abd al-Jani, Muhammad. The impact of interest rate movement on consumption and output. Journal of Faculty of Politics and Economics. 2020. Vol. 2020, no. 7, pp.1-29.
https://search.emarefa.net/detail/BIM-1260960
Data Type
Journal Articles
Language
English
Notes
-
Record ID
BIM-1260960