The impact of certain monetary variables on inflation rates: A comparative econometric study (Turkey- Egypt)

Abstract

The research aims to study monetary policy, represented by its quantitative tools, and its role in addressing inflation through the impact of certain monetary variables on the inflation issue faced by Turkey and Egypt. The research is based on the hypothesis that the expansion of the money supply has negative effects on economic performance. The study adopted the inductive method, which starts with particulars to reach general conclusions, using analytical and econometric methods to validate the hypothesis. The research concluded that the narrow money supply variable is the most influential on inflation in both countries, with the elasticity coefficient reaching 0.43 in Turkey and 0.303 in Egypt. The study confirmed that monetary policy tools in Turkey have a greater impact on inflation rates compared to Egypt, despite the significance of both models.