Research
Impact of Money Supply (M2) on GDP of Pakistan
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 high rate 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 (2000-2011) 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.
Money Laundering-A Negative Impact on Economy
This menace needs thorough probing whereby national money is remitted abroad thus depriving national exchequer for meeting its people’s lawful needs. These unlawful acts of Heads of State, Government and high functionaries including agencies leave the country’s economy in dilapidated conditions. This money is snatched through kick-backs and unfair means which we may discuss later on. This issue is not only that of Pakistan rather it is faced by most of the third world countries. This needs eradication on national as well as on international level. Civil society, judiciary, print and electronic media can play pivotal role for money laundering stoppage. This study is about the awareness of money laundering by businessmen; salary persons include government employees, lawyers, MNA’s, inspectors. This cross sectional study was conducted from March 2012 to May 2012. A group of 51 persons took part in this study through a predesigned questionnaire which consists of five parts to meet the objectives, awareness, affects, laws, re-use of money laundering and corrective actions and we conclude that money laundering, an evil, can be eradicated through strict laws, government will to prevent, banking control with international help for the return of laundered money to its native country.
