The impact of monetary and non-monetary factors on GDP dynamics of the Visegrád Group countries
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The aim of the article is to identify the factors affecting economic growth of the Visegroup countries. Linear regression have been exploited to analyze the impact of both monetary and non-monetary factors on gross domestic product dynamics of Poland, Check Republic, Slovakia and Hungary. The study have revealed that both monetary and non-monetary factors have impact on GDP dynamics of the Visegrad Group countries, but household final consumption, exports of goods and services, inflation, high-technology exports and broad money growth show the highest correlation with GDP of the countries. All regression models consider GDP dynamics as dependent variable. Collinearity of certain predictor variables have not allowed using the most significant factors to develop linear regression models. As a result, independent variables sets are not those of the highest statistical significance. Therefore, regression model of Poland includes inflation, high-technology exports and real interest rate as predictor variables. Regression model of Check Republic shows the correlation between GDP dynamics as dependent variable and high technology exports, domestic credit provided by financial sector and broad money growth as independent ones. The following independent variables are used to develop the regression line of Slovakia: domestic credit provided by financial sector and broad money growth. Linear regression model of Hungary includes inflation and foreign direct investment as predictors. The study have confirmed the strong positive effect making by foreign direct investment on economic growth of the post-communist countries. The research results also contribute to the thesis about low inflation as one of the key factors of economic growth in the Central European countries. The study also have proved the significant effect on economic growth made by domestic credit provided by financial sector and significant correlation between GDP dynamics and export of goods and services.
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