Business, Management and Accounting
4 years ago

Gulf Arab States Face Inflation Threat Due to Money Supply

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MPRA Paper
Country Heterogeneity and Long-Run Determinants of Inflation in the Gulf Arab States
Syed Abul Basher, Elsayed Mousa Elsamadisy

Paper Summary

The article analyzes inflation in Gulf Arab States from 1980-2008. Money supply is a key factor in causing inflation in both short- and long-term. Foreign prices and exchange rates also affect inflation. It takes about 2.9 years for inflation to adjust after a shock. This suggests that Gulf countries should have more control over their monetary policies.

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