How the banking system is creating a two-way inflation in an economy

Ahmed Mehedi Nizam

PLOS ONE, 2020, vol. 15, issue 4, 1-40

Abstract: Here we argue that due to the difference between real GDP growth rate and nominal deposit rate, a demand pull inflation is induced into the economy. On the other hand, due to the difference between real GDP growth rate and nominal lending rate, a cost push inflation is created. We compare the performance of our model to the Fisherian one by using Toda and Yamamoto approach of testing Granger Causality in the context of non-stationary data. We then use ARDL Bounds Testing approach to cross-check the results obtained from T-Y approach.

Date: 2020
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Related works:
Working Paper: How the banking system is creating a two-way inflation in an economy (2020)
Working Paper: How the banking system is creating a two-way inflation in an economy? (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0229937

DOI: 10.1371/journal.pone.0229937

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