Assess The Long Run Effects Of Monetary Policy On Bank lending,Foreign Asset and Liability In MENA Countries

Ziaei, Sayyed Mahdi (2009): Assess The Long Run Effects Of Monetary Policy On Bank lending,Foreign Asset and Liability In MENA Countries.

Abstract

In this empirical study, we perform cointegrated relation to analyze the effects of monetary policy on bank credit to private sector, foreign assets and foreign debts in ten MENA countries include: Algeria, Bahrain, Egypt, Kuwait, Lebanon, Morocco, Oman, Qatar, Tunis and Turkey. There are two co-integration techniques, the Johanson co-integration and dynamic ordinary least square (DOLS) are used to examine long run relationship between the variables. The empirical evidences with aggregate data of ten MENA countries show that bank credit to private sector and foreign asset increasing with a monetary expansion. However, the positions of banks’ foreign debts aren’t similar for different countries. Hence, the aggregate data show that bank lending channel is likely to be an effective monetary transmission mechanism in MENA countries.

• Item Type: MPRA Paper
• Language: English
• Keywords: Bank Lending, Monetary Transmission, Capital Flows
• Subjects: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E51 - Money Supply ; Credit ; Money Multipliers; F - International Economics > F3 - International Finance > F32 - Current Account Adjustment ; Short-Term Capital Movements; E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy

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