Money Supply, Inflation and Economic Growth Nexus in Ethiopia

Money Supply, Inflation and Economic Growth Nexus in Ethiopia

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In countries where financial information system is vulnerable to imperfect information, it is quite challenging to see the effect of macroeconomic measures immediately. In this study, therefore, it is tried to comprehend the nexus of economic growth, inflation and money supply in Ethiopia since 1963. Linear regression using STATA software was employed to examine if robust correlation exists between the variables. The dependent variable was inflation and the independent variables were GDP and money supply as an explanatory variable and drought and war as dummy variable. Annual averages of the v...