The Impact of Monetary Policy on Achieving Economic Growth in the Libyan Economy

Abstract

This research aims to study one of the economic policies, namely monetary policy, and the difficulties it faces, the most important monetary reforms implemented in the Libyan economy, and the achievement of economic development. This research aims to identify the relationship between monetary policy in the Libyan economy, which comprises (exchange rate and money supply) as independent variables, and gross domestic product (GDP) as a dependent variable, during the period (2000-2023). The researcher followed a descriptive approach with an analytical approach, in addition to a standard approach using statistical analysis (Eviews) using the ordinary least squares (OLS) method, with the aid of graphs to illustrate the time sequence of the model variables. The researcher concluded that there is a direct relationship between (exchange rate and money supply) as independent variables, and GDP as the dependent variable, at a rate of (59%). The independent variables explain approximately (55%) of the variance in GDP, while (45%) is due to other factors. The researcher recommends adopting an expansionary policy by increasing the money supply.