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Dynamic Econometric Models

Demonetisation as an Economic Policy Tool: Macroeconomic Implications of a Monetary Market Shock. The Example of the Indian Monetary Reform
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Demonetisation as an Economic Policy Tool: Macroeconomic Implications of a Monetary Market Shock. The Example of the Indian Monetary Reform

Authors

  • Sebastian Amit Roy SGH Warsaw School of Economics

DOI:

https://doi.org/10.12775/DEM.2019.003

Keywords

developing economies, inflation, macroeconomic policy, monetary policy, panel econometrics

Abstract

This paper discusses the implementation of the 2016 India demonetisation, and analyses its macroeconomic consequences. The pivotal issue here is a regional heterogeneity of CPI inflation caused by demonetisation. A dynamic panel CPI model has been estimated in order to find out whether unequal accessibility of banking services determines the inflation heterogeneity. The findings suggest that financial services accessibility is not a significant inflation-driving factor. Hence a hypothesis about a redistribution of wealth between rural and urban areas with different access to banking might be rejected.

Author Biography

Sebastian Amit Roy, SGH Warsaw School of Economics

BA in Quantitative Economics from SGH Warsaw School of Economics, currently MA student at QEM - Models and Methods of Quantitative Economics at Universitat Autonoma de Barcelona.

References

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Dynamic Econometric Models

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Published

2019-12-28

How to Cite

1.
ROY, Sebastian Amit. Demonetisation as an Economic Policy Tool: Macroeconomic Implications of a Monetary Market Shock. The Example of the Indian Monetary Reform. Dynamic Econometric Models. Online. 28 December 2019. Vol. 19, pp. 41-56. [Accessed 15 May 2025]. DOI 10.12775/DEM.2019.003.
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Vol. 19 (2019)

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