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Monetary policy in Namibia, 1993-2011

This thesis investigated the role of monetary policy in Namibia for the period 1993 to 2011. It aims at achieving six objectives. First, it reviews the evolution of monetary policy in Namibia for the period 1980 to 2011. Second, it investigates the interest rate channel of the monetary policy transmission mechanism in Namibia. Third, it analyses the credit channel of the monetary policy transmission mechanism in Namibia. Fourth, it evaluates the exchange rate channel of the monetary policy transmission mechanism in Namibia. Fifth, it studies the money effect model in the context of the monetary policy transmission mechanism in Namibia. Sixth, it examines the exchange rate pass–through (ERPT) to domestic prices in Namibia. In order to achieve the objectives of the relative importance of the different channels of monetary policy transmission, a structural vector autoregressive model of the Namibian economy is constructed. Specifically the responses of the output and prices to monetary policy shocks for Namibia over the quarterly period 1993:Q1 to 2011:Q4 are investigated using impulse response functions and forecast variance error decompositions obtained from a structural vector autoregressive model (SVAR). The thesis also examined the exchange rate pass-through from exchange rate to domestic prices using both SVAR and the single equation error correction model (ECM). Estimation results on the different channels of monetary policy transmission mechanism showed that the interest rate channel and the credit channel are effective in transmitting monetary policy actions. The exchange rate channel is also operative but not effective. The money effect model confirms that inflation in Namibia is not a monetary phenomenon. The results of the pass-through relationship showed that there is an incomplete but high exchange rate pass-through from exchange rate to domestic prices.

Identiferoai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:nmmu/vital:20493
Date January 2013
CreatorsSheefeni, Johannes Peyavali Sheefeni
PublisherNelson Mandela Metropolitan University, Faculty of Business and Economic Sciences
Source SetsSouth African National ETD Portal
LanguageEnglish
Detected LanguageEnglish
TypeThesis, Doctoral, DPhil
Formatix, 230 leaves, pdf
RightsNelson Mandela Metropolitan University

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