| Abstract: | SUMMARY
In assessing the relative costs and benefits associated with introducing a more active monetary and fiscal policy and a different exchange rate regime in the Republic of Macedonia, all econometrics results, using different methodologies (SVAR and VECM), show that introducing such policies in order to promote rapid economic growth could easy disturb macroeconomic stability (after having achieved it at a substantial cost) without any significant economic benefits. Therefore, introducing more active monetary and fiscal policies and a different exchange rate regime is likely to incur more costs than benefits, since changes of monetary and fiscal policy and exchange rate regime type do not show a persistent effect on real GDP, while changes of money stock and exchange rate regime do show a strong and persistent effect on prices level. (i) The empirical analyses reveal that money supply and interest rate prove to be weak as independent channels of monetary transmission in the Republic of Macedonia, and therefore the result does not suggest that money supply and interest rate are useful to the NBRM as independent instruments of monetary policy. This is a consequence of the fact that the banking and financial sectors are still characterized by shallow levels of financial intermediation - the financial sector is underdeveloped, the banking sector suffers from a lack of competition, and the economy has a high degree of dollarization. Therefore, an increase of money supply does not show any significant effect on real GDP via either the asset prices effect, the wealth effect, the bank-lending effect and the firms' balance sheet effect, while it does have a strong effect on prices level. The interest rate in the Republic of Macedonia has not been an effective monetary policy instrument, since in relatively higher dollarized economies, such as that of the Republic of Macedonia, the potential effectiveness of an independent interest rate policy is limited. Therefore, the result suggests that the primary role of monetary policy should be to control the rate of inflation in the Republic of Macedonia since changes in the money stock did not show a significant effect on real GDP, while they exhibit a strong and persistent effect on prices level. (ii) As for fiscal policy, changes in the primary fiscal deficit and government expenditure do not show any significant conventional Keynesian effects on real GDP. The changes in primary fiscal deficit and government expenditure (expansionary fiscal policy) do not have a significant effect on real GDP due to the counteracting effect of monetary policy reactions (contractionary monetary policy) in the Republic of Macedonia. Monetary policy reacts immediately, and it continues its counteracting effects until the effects of fiscal policy disappear. This is consistent with the evidence that monetary policy reacts to sterilize excess liquidity in the banking system caused by expansionary fiscal policy. The only channel that shows a transitory effect on real GDP is tax-cuts, but it does not show a persistent effect on real GDP, so the result goes by the name "policy ineffectiveness result". Since the conventional Keynesian effects of fiscal policy on real GDP do not function in the Republic of Macedonia, the results suggest that the optimal fiscal policy in the Republic of Macedonia is to apply fiscal strategy based on fiscal rules (by determination of the mathematical targets of the fiscal deficit, public expenditure and the public debt in the medium term), in order to achieve positive macroeconomic outcomes.
POVZETEK
Na osnovi ovrednotenja relativnih stroškov in koristi, povezanih z uvedbo bolj aktivne monetarae in fiskalne politike ter drugačnega režima deviznega tečaja v Republiki Makedoniji, pri čemer sta bili uporabljeni dve metodologiji (SVAR in VECM), lahko zaključimo, da uvedba takšnih politik z namenom spodbujanja hitre gospodarske rasti lahko negativno vpliva na makroekonomsko stabilnost (zatem, ko je bila le-ta dosežena s precejšnjimi stroški), ne da bi prinesla pomembnejše gospodarske koristi. Zato lahko uvedba aktivnejše monetarne in fiskalne politike ter drugačnega režima deviznega tečaja hitro povzroči več stroškov kot pa prinese koristi, saj spremembe monetarne in fiskalne politike ter vrste režima deviznega tečaja nimajo večjega vpliva na realni BDP, medtem ko spremembe obsega denarne mase in režima deviznega tečaja kažejo močan in vztrajen vpliv na oblikovanje ravni cen. (i) Empirične analize kažejo, da dobava denarja in obrestna mera kot samostojna kanala monetarne transmisije v Republiki Makedoniji nimata posebne moči, zato je na osnovi rezultata mogoče sklepati, da dobava denarja in obrestna mera za Narodno banko Republike Makedonije nista posebej učinkovita samostpjna inštrumenta monetarne politike. To je posledica dejstva, da je za bančni in finančni sektor še vedno značilno slabo razvito finančno posredništvo - finančni sektor je nerazvit, v bančnem sektorju primanjkuje konkurence, za gospodarstvo pa je značilna visoka dolarizacija. Povečanje denarnih prilivov ne kaže pomembnega učinka na realni BDP, ne glede na to, ali do njega pride zaradi spremembe cen sredstev, učinka premoženja, bančnih posojil ali bilanc stanja v podjetjih; kaže pa močan učinek na oblikovanje ravni cen. Obrestna mera v Republiki Makedoniji ni učinkovit inštrument monetarne politike - za gospodarstvo z relativno visokim deležem dolarizacije, kakršno je tudi makedonsko, je potencialni vpliv učinkovitosti politike neodvisne obrestne mere precej omejen. Na osnovi rezultatov zato lahko sklepamo, da je primarna vloga monetarne politike nadzorovanje inflacije v Republiki Makedoniji, saj denarna masa nima signifikantnega vpliva na realni BDP, medtem ko močno vpliva na oblikovanje ravni cen. (ii) Kar se tiče davčne politike, spremembe primarnega fiskalnega deficita in javnofinančni odhodki ne kažejo signifikantnega keynesijanskega učinka na realni BDP. Spremembe primaraega fiskalnega deficita in javnofinančni odhodki (ekspanzivna fiskalna politika) v Republiki Makedoniji zaradi nasprotnega učinka monetarne politike (restriktivna monetarna politika) ne izkazujejo signifikantnega učinka na realni BDP. Monetarna politika se odzove takoj in tako dolgo izvaja nasprotne ukrepe, dokler učinki fiskalne politike povsem ne izginejo. Ta odziv je v skladu z običajno reakcijo monetarne politike, in sicer s steriliziranjem presežne likvidnosti v bančnem sistemu, ki se pojavi zaradi ekspanzivne fiskalne politike. Edina metoda, ki prehodno vpliva na realni BDP, je znižanje davkov, vendar je ta vpliv na realni BDP le začasen, zaradi česar je ta učinek poimenovan "rezultat neučinkovitosti politike". Ker v Republiki Makedoniji ni običajnih keynesijanskih učinkov fiskalne politike na realni BDP, izsledki nakazujejo, da je optimalna davčna politika za Republiko Makedonijo v uvedbi fiskalne strategije, ki temelji na fiskalnih pravilih (s pomočjo določitve matematičnih ciljev davčnega |
Optimal Strategy of Monetary and Fiscal Policy in Function of Maintaining Macroeconomics Stability in The Republic of Macedonia / Besnik Fetai
