Open AccessFinancial Liberalisation and the Demand for Money in Pakistan
Author(s) -
Ashfaque H. Khan
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.997-1010
Subject(s) - liberalization , financial deepening , economics , investment (military) , competition (biology) , distortion (music) , welfare , monetary economics , international economics , financial market , monetary policy , money market , financial system , economic policy , business , market economy , finance , financial intermediary , ecology , amplifier , cmos , electronic engineering , politics , biology , political science , law , engineering
An efficient and liberalised fmancial sector is essential forpromoting economic growth and welfare. The process of fmancialliberalisation through "deepening" and eliminating distortion andsegmentation of financial markets improves the process of themobilisation of savings as well as the efficiency of investment, therebyaccelerating the overall rate of economic growth. At the end of 1989Pakistan undertook an ambitious financial sector reforms programme withthe aim to improve the effectiveness of monetary policy through greaterreliance on market forces. The main liberalisation policies were aimedat liberalising interest rates, reducing controls on credit, enhancingcompetition and efficiency in the fmancial system, strengthening thesupervisory framework, and promoting the growth and deepening offmancial markets.