MONEY, INCOME, AND CAUSALITY: THE BANGLADESH EXPERIENCE

This paper seeks to examine the causal relationship between money
and income in Bangladesh economy covering the period 1972/73 to 2007/
08. The cointegration analysis indicates a long-run relationship between
money and income. The error correction framework suggests a one-way
causation from money to income in the short-run as well as in the long-run
implying a relatively active role for money in influencing economic activities
in Bangladesh.