Abstract
The issue of whether money supply is a dependent or an independent variable remains a debating one, especially with the ongoing development and innovation of institutions, tools, and financial, monetary, and banking derivatives. In general, we can say that there are two trends of thought about the issue under consideration. The first trend views money supply as an exogenous variable because the monetary authority can control and monitor it. The second one views money supply as an endogenous variable because Federal Bank has no ability to affect it, especially when nominal or money income is changed and reflected on money multiplier and money supply, and also when the monetary authority cannot restrict the monetary expansion as a result of different factors related to the economy structure or related to other non-economic factors.
Highlights
INTRODUCTIONIn Iraq, after 2003, the monetary policy witnessed dramatic changes in legal and operational aspects as well as in tools taken which are considered relevant to the aims that the monetary authority is seeking to achieve
Central bank has tool levels that have to be suitable with targets of usually several important goals in its policy, which the monetary authority
Tors, the variation from economic goals, and making the monetary policy just a tool for finance, re- The expanding in money issuing and the absorbing sulted in making money supply an en- of most banking deposits by government led to hydogenous variable represented clearly in public perinflation, essential declining in exchange rate of budget constraint[1], and this consists with what ex- Iraqi Dinar, and eventually the economic collapse
Summary
In Iraq, after 2003, the monetary policy witnessed dramatic changes in legal and operational aspects as well as in tools taken which are considered relevant to the aims that the monetary authority is seeking to achieve. It is important to verify the nature of money supply in Iraq if it is exogenous or endogenous variable because knowing the answer to this question would determine the monetary policy effectiveness and identify suitable tools for central bank to put money supply under control. The study aims to identify the effects on economy when money supply is considered an endogenous or an exogenous variable.
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
