Open AccessIncome Velocity and per Capita Income in Pakistan: 1974-75 to 1991-92
Author(s) -
Faiz Bilquees,
Shahnaz A. Rauf
Publication year - 1994
Publication title -
pakistan development review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.154
H-Index - 26
ISSN - 0030-9729
DOI - 10.30541/v33i4iipp.985-995
Subject(s) - economics , inflation (cosmology) , per capita income , yield (engineering) , period (music) , per capita , demographic economics , development economics , macroeconomics , demography , population , physics , materials science , sociology , theoretical physics , acoustics , metallurgy
The purpose of this paper is to bring to light the effects ofvelocity on monetary policy during the process of development. Thestated hypothesis is that if velocity declines as per-capita incomeincreases, the monetary authorities can issue more money to financeeconomic growth with low rates of inflation. This short paper attemptsto test the hypothesis in the post 1974 period for the present Pakistanover the period 1974-75 to 1991-92. This period corresponds to theofficial division of all the financial and other statistics between Eastand West Pakistan. The financial developments and the trends in overalleconomic development over the period is expected to yield resultsdifferent from the studies done in the earlier period.