Tongas monetary authority, National Reserve Bank of Tonga (NRBT) is entrusted with the responsibility of managing Tongas monetary system and exchange rate stability. This paper undertakes an empirical study of monetary policies pursued by NRBT with specific focus on the transmission mechanism of...

This paper examines the roles of foreign direct investment (FDI) and financial development (FD) in Pacific island countries (PICs), with a case study on Vanuatu. It has been documented in various empirical studies on other regions that well developed financial systems enable countries to take...

Pacific island countries have been affected by the ongoing global economic downturn. The impact of recessionary effects has not been uniform as the degree of global interdependence varies amongst Pacific island countries. By employing a vector autoregression (VAR) model, this paper investigates...

Amongst the 14 Pacific island countries, Vanuatu is unique in many respects. It has no exchange controls. Further, it allows full freedom for its citizens and resident expatriates alike to hold domestic bank deposits in any major currency of their choice. The country has adopted a fixed exchange...

There has been a general consensus among economists that while the long-run effects of money are felt only on prices with no impact on real variables, monetary policy changes do have important short-run effects on real variables. The objective of the paper is to investigate whether money has...