Impact of Money Supply (M2) on GDP of Pakistan

Iqra Ihsan; Saleem Anjum

Impact of Money Supply (M2) on GDP of Pakistan

Iqra Ihsan * §

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Saleem Anjum

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§ University of Lahore, Pakistan.

Impact of Money Supply (M2) on GDP of Pakistan

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Abstract

The main role of money supply (M2) on GDP of Pakistan is described. The excessive money supply (M2) by SBP (State Bank of Pakistan) to run the country entails to highrate of inflation if the indicators i.e. CPI, interest rate are not controlled within the prescribed limits. The more the money supply will be in the economy, the greater the inflation rate would be. No sooner, the indicators improves production in all sectors i.e. industry, agriculture, education, health and basic infrastructures increases, money supply would be lesser, inflation decreases and GDP increases accordingly. We have taken into consideration the data for 12 years (2000)(2001)(2002)(2003)(2004)(2005)(2006)(2007)(2008)(2009)(2010)(2011) and analyzed this data by using the Regression Model. In this model we have taken three independent variables that are inflation rate, interest rate and CPI because money supply is affected both one of them and one dependent variable that is GDP. The CPI and interest rate have a significant impact on GDP and inflation rate has insignificant impact on GDP.

References

13 Cites in Article

Reference Format

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Iqra Ihsan, Saleem Anjum. 2013. "Impact of Money Supply (M2) on GDP of Pakistan". Global Journal of Management and Business Research - C: Finance GJMBR-C Volume 13 (GJMBR Volume 13 Issue C6).

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GJMBR Volume 13 Issue C6

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

Keywords

CPI GDP inflation Interest rate money supply

Classification

GJMBR-C Classification FOR Code: E51

E49

Submission ReceivedDecember 9, 2012
Peer Review Double Blind
Handling Editor
Accepted January 1, 2013
Published January 15, 2013

Version of record

v1.2

Issue date

June 28, 2013

Language

English

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Article Matrices

Total Score: 149

Country: Pakistan

Subject: Global Journal of Management and Business Research

Authors: Iqra Ihsan, Saleem Anjum (PhD/Dr. count: 0)

View Count (all-time): 298

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Publish Date: 2013 01, Tue

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