Monetary policy effectiveness in digital era: Egypt case | ||
| المجلة العلمية للدراسات والبحوث المالية والإدارية | ||
| Article 1, Volume 16, Issue 4, December 2024, Pages 1-53 PDF (1.27 M) | ||
| Document Type: المقالة الأصلية | ||
| DOI: 10.21608/masf.2024.413739 | ||
| Authors | ||
| prof. Sherief Mohammed Ali* 1; Hossam Eldin Ahmed Mohammed* 2 | ||
| 1Professor of economics - Economics and Public finance Department Former Vice President of the University for Education and Student Affairs Former dean of faculty of commerce University of Sadat city | ||
| 2Assistant Lecturer- Economics and Public finance Department Faculty of Commerce- University of Sadat City | ||
| Abstract | ||
| This research explores the impact of digital transformation on the effectiveness of monetary policy in Egypt, focusing on the growing influence of electronic payments and fintech innovations. The study addresses how digitalization is reshaping traditional monetary transmission mechanisms, particularly the role of cash, interest rates, and liquidity management. Using an Autoregressive Distributed Lag (ARDL) model, this research analyzes the long- and short-term relationships between variables such as the number of Automated Teller Machines (ATMs), interest rates, GDP per capita, and the exchange rate on inflation, which serves as a proxy for monetary policy effectiveness. The findings indicate that while digital payment systems reduce inflationary pressures in the long term, increased financial digitalization and higher GDP per capita drive-up inflation through demand-pull and cost-push mechanisms. The results underscore the challenges faced by the Central Bank of Egypt in adapting its monetary tools to a rapidly evolving digital financial ecosystem. The study concludes with policy recommendations to enhance regulatory oversight, promote financial inclusion, and integrate digital financial metrics into the central bank's policy framework, ensuring continued economic stability in the digital era. | ||
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