Close Menu

Moses C. V. Pologne

Right Theory, Wrong Variable: Foreign Variables and Monetary Policy in Jamaica

Issue: 

The quantity theory of money suggests there is an unambiguous causal
relationship between money supply and price level. Quarterly data from
Jamaica for a 28-year period (1980-2008) reveal that two other variables
exert influence on the price level. The first causal relationship is between
changes in the exchange rate and the price level. The second is between US
money supply and Jamaica’s price level. These results suggest that
monetary policy in small open economies may not, by itself, tame
inflationary pressures (JEL E31, F31).
 

USD $10.00
Price: USD $10.00
Journal Sections: 
Subscribe to RSS - Moses C. V. Pologne
Top of Page