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http://dx.doi.org/10.13106/jafeb.2022.vol9.no1.0153

The Nexus Between Monetary Policy and Economic Growth: Evidence from Vietnam  

NGUYEN, Hoang Chung (Department of Finance and Banking, Business School, Thu Dau Mot University)
Publication Information
The Journal of Asian Finance, Economics and Business / v.9, no.1, 2022 , pp. 153-166 More about this Journal
Abstract
The study estimates the Structured VAR and the Dynamic Stochastic General Equilibrium Model for the Vietnamese economy based on the new Keynesian model for small and open economies, with the output gap, inflation, policy interest rate, the Vietnamese exchange rate, and the inflation and interest rate in the United States. The paper aims to clarify the impulse response of the macro variables through their shocks. It offers to model the SVAR and DSGE processes, as well as describe why and how interest rate policy is important in the impulse response of macro variables like the output gap and inflation process. The study supports the central role of monetary policy by giving empirical evidence for the new Keynesian theory, according to which an interest rate shock causes the output gap to widen and inflation to decrease. Finally, the application of the DSGE model is becoming more and more popular in the State Bank of Viet Nam to improve its policy planning, analyzing, and forecasting policy towards sustainable and stable growth.
Keywords
Monetary Policy; The New Keynesian Theory; Structural VAR; DSGE; Rational Expectations;
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Times Cited By KSCI : 3  (Citation Analysis)
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