The Determinants of CPI Inflation in Bangladesh, 1980-2016
Mohammad Mahabub Alam
Additional contact information
Mohammad Mahabub Alam: Senior Assistant Secretary, Macroeconomic Wing, Finance Division, Ministry of Finance, Bangladesh
Asian Journal of Economic Modelling, 2018, vol. 6, issue 4, 441-461
This paper investigates the major determinants of CPI inflation in Bangladesh by employing Johansen?s Cointegration technique and the associated Vector Error Correction Model using the annual data series from 1980 to 2016. The study examines a wide range of variables covering all major sectors, such as money supply, exchange rate (monetary sector), GDP (real sector), exports, imports (external sector), government expenditure, government revenue (fiscal sector) to find the major determinants of CPI inflation. The paper finds that GDP and imports are the two major sources of CPI inflation while government revenue and money supply have a moderate effect on CPI inflation in the long run. The study also reveals that exports, government expenditure, and exchange rate do not cause CPI inflation rather negatively affect CPI inflation in Bangladesh. In the short run, the previous year?s CPI inflation has a strong influence, while the previous year?s imports has a moderate influence on the current year?s CPI inflation in Bangladesh.
Keywords: CPI; Inflation determinants; Cointegration test; Price stability; Bangladesh. (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:asi:ajemod:2018:p:441-461
Access Statistics for this article
Asian Journal of Economic Modelling is currently edited by Muhammad Irfan
More articles in Asian Journal of Economic Modelling from Asian Economic and Social Society Sadeeq Block, Near Fawara Chowk, Abbasia Town, Rahim Yar Khan - 64200, Punjab, Pakistan.
Bibliographic data for series maintained by Qazi Muhammad Imran ().