Testing for the fisher hypothesis in Namibia
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Date
2013
Journal Title
Journal ISSN
Volume Title
Publisher
Globalbiz Research
Abstract
This paper analyses the relationship between interest rate and inflation in Namibia. The objective
is to test whether the Fisher hypothesis holds in the long run. Using monthly data for the period
1992:01 – 2011:12, the paper employed time series techniques, namely, unit root tests and
cointegration test. The unit root test reveales that the series are non stationary. The cointegration
test shows that there is no cointegration among the variables. Hence, the long run relationship
between inflation and interest rate is non existent. The study rejects the Fisher hypothesis in the
Namibian context. In the absence of cointegration the study could not proceed with Granger
causality test.
Description
Keywords
Fisher effect, Nominal interest rate, Inflation, Cointegration test, Namibia
Citation
Sheefeni , J. P. (2013). Testing for the fisher hypothesis in Namibia. Journal of Emerging Issues in Economics, Finance and Banking, 2(1), 571-582