Monetization in Low- and Middle-Income Countries

Author/Editor:

Cameron McLoughlin ; Noriaki Kinoshita

Publication Date:

June 1, 2012

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The degree of an economy’s monetization, which has an important implication on economic growth, can be affected by the conduct of monetary policy, financial sector reform, and episodes of financial crises. The paper finds that monetization--measured by the ratio of broad money to nominal GDP-- in low- to middle-income countries is significantly correlated with per-capita GDP, real interest rates, and financial sector reform. It suggests that maintaining an upward momentum in monetization can be an important policy objective, particularly for low-income countries, and that monetary and financial sector policies need to be conducive to enhancing monetization.

Series:

Working Paper No. 12/160

Subject:

English

Publication Date:

June 1, 2012

ISBN/ISSN:

9781475504651/1018-5941

Stock No:

WPIEA2012160

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

23

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