Please use this identifier to cite or link to this item: http://repo.lib.jfn.ac.lk/ujrr/handle/123456789/3639
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dc.contributor.authorKesavarajah, M.
dc.contributor.authorAmirthalingam, K.
dc.date.accessioned2021-07-16T04:09:31Z
dc.date.accessioned2022-07-07T07:14:15Z-
dc.date.available2021-07-16T04:09:31Z
dc.date.available2022-07-07T07:14:15Z-
dc.date.issued2012
dc.identifier.issn2279-1922
dc.identifier.urihttp://repo.lib.jfn.ac.lk/ujrr/handle/123456789/3639-
dc.description.abstractThe purpose of this study is to examine the nexus between money supply and inflation in Sri Lanka over the period 1978 to 2010. The annual time series secondary data on inflation, money supply, budget deficit and exchange rate were drawn from various annual reports of Central Bank of Sri Lanka. Moreover, Johanson and Juseliues multivariate cointegration test and Granger causality tests are employed to estimate the long run equilibrium relationship among the variables. The Augmented Dickey Fuller (ADF) unit root test was used to examine the properties of the time series variables and to determine the order of integration for each series in this study. The choice of the lag length of the time series variables are based on the minimum Akaike Information Criterion (AIC). According to the Johansen Maximum likelihood test, the computed trace statistic, maximum Eigen statistic and their corresponding critical statistic indicates that the null hypothesis of “no cointegration” can be rejected at five percent level of significance. This result supports the presence of long run relationship among the variables. Moreover, the Granger causality test indicates while there was a significant causality from money supply to inflation and exchange rate to inflation while the causality from budget deficit to inflation was insignificant. Further, analysis indicates that inflation is mainly attributed to the monetary expansion in Sri Lanka during the post liberalization period. Therefore, this study concludes that money supply variable can be used as an effective policy instrument to maintain the price stability in Sri Lanka.en_US
dc.language.isoenen_US
dc.publisherUniversity of Jaffnaen_US
dc.subjectCausalityen_US
dc.subjectExchange rate inflationen_US
dc.subjectMoney Supplyen_US
dc.titleThe nexus between money supply and inflation in sri lankaen_US
dc.typeArticleen_US
Appears in Collections:JUICE 2012

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