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ISSN No: 1608-6627
Editorial Board
Guidelines for Article Submission

Articles for Volume Year 2018 Volume 30-1

Macro Modeling Practices at Nepal Rastra Bank
[Nepal Rastra Bank, Research Department*]

This paper presents a brief survey of macroeconomic models of Nepal. It also empirically investigates sectoral models of macroeconomic variables including inflation, monetary aggregate, fiscal and external sector upon which policymakers' concern rests during the process of monetary policy formulation. Sample period of 1975 to 2016 is used for the estimation. The Data Generating Process (DGP) identified in this paper for the variables of interest meets necessary criteria both from theory and empirical ground. These models are useful to understand general relationship from sectoral perspective and to carryout simple forecasting for making monetary and other macroeconomic policy decisions

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Revisiting Money-Price Relationship in Nepal Following a New Methodological Framework
[Min Bahadur Shrestha, Ph.D.*, Guna Raj Bhatta**]

Information on the pattern of money-price relationship is crucial for formulating appropriate monetary policy and implementing it effectively. This paper re-examines the money-price relationship in Nepal following a new methodological framework for time series data analysis. Test results show that money supply significantly affects domestic price in Nepal. Indian inflation is the major factor that has largest impact on the price situation in Nepal. However, exchange rate is not found to be associated with the changes in price level in Nepal. Test results also show that money-price relationship in Nepal has become much stronger in the recent times in terms of the magnitude of impact.

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Impact of Exchange Rate on Trade Deficit and Foreign Exchange Reserve in Nepal: An Empirical Analysis
[Deepak Adhikari]

The objective of the study is to examine the impact of exchange rate on trade deficit and foreign exchange reserve in Nepal. The hypotheses of the study are: (a) there is no significant positive association between nominal exchange rate and foreign exchange reserve and (b) there is no significant relationship between nominal exchange rate of Nepalese rupee with US dollar and trade deficit. As empirical analysis shows that one percentage point depreciation of the Nepalese rupee (NPR) with respect to US dollar results in an (a) increase in reserve by 0.82 percentage points and (b) decline in trade deficit by 0.75 percentage points, the null hypotheses are rejected, thus suggesting that maintaining NPR undervalued with US dollar can improve trade deficit and increase foreign exchange reserves. However, because of pegging with Indian currency, NPR sometimes appreciates in line with Indian currency. This situation could be counterproductive for improving trade deficit and increasing foreign exchange reserve of Nepal. In conclusion, considering the external sector stability as one of the major policy objectives, exchange rate policy can be fine-tuned to correct the trade deficit and maintain adequate foreign exchange reserve to sustain imports and service external debt.

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Fiscal Imbalances in Nepal's Federalism : An Empirical Analysis
[Achyut Wagle]

The most overarching and universally accepted imperative to federalize any unitary nation-state is to reduce, both vertical and horizontal, fiscal imbalances as ensured availability of financial resources only could augment any form of well-being and prosperity. Such imbalances constrict all desirable economic outcomes. But, while carving seven States out of the erstwhile unitary state, any other priority like identity or territoriality may have prevailed but fiscal imbalance. This study shows that mainly vertical fiscal imbalance still alarmingly persists even after federalization of the country. The Panel Corrected Standard Error (PCSE) model examines how these imbalances between the federation and the sub-national units (vertical) and, also among the States themselves(horizontal) are likely to impact on the fiscal federalism framework and its functionality. It contends that highly skewed distribution and mobilization of financial resources essentially defeats the very rationale of federalizing Nepal and, much debated identity consideration in federalism has no positive welfare implication.

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Work Family Conflict and Career Satisfaction in Banking Sector of Nepal
[Jyoti Regmi Adhikary]

While a wealth of research has examined how work family conflict (WFC) affects negative work outcomes, there is limited research investigating the relationship of WFC with positive work outcomes. Using a sample of 381 Nepali banking professionals, this study examined the relationships of WFC with career satisfaction and social support. Study also explored how the socio demographic variables affected WFC, career satisfaction, and social support. Analyses indicated no statistically significant relationships of WFC with career satisfaction. Results also indicated association of social support from both work and family with increased career satisfaction. However, social support did not emerge as a significant moderator in the relationship between WFC and career satisfaction. In case of socio-demographic variables, only organizational grouping stood out as significant difference in the level of WFC experience among banking employees. This study has various theoretical and practical implications that are presented along with further research issues.

View full article Work Family Conflict and Career Satisfaction in Banking Sector of Nepal