Gupta and Goldfajin defined a tight monetary as “a case in which real interest rates in the aftermath of the crises are higher than the average real interest rate during the 24 months preceding the crises”(Goldfajn and Gupta, 1999, p.4). The primary objective of ensuring that the monetary policy is tightened is to make sure that the supply of money in the economy is reduced and also to ensure a conducive environment for businesses. For a commercial bank to lend money, there are a lot of factors that it considers. Some of the factors include the volume of ...
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The depression of 1930’s was known as the great depression because its ripples were felt in all countries of the word. It originated from United States and its spread was attributed to the forged relationship between United States and European economies. The further spread to primary producing countries is attributed to the trade interrelation which had developed between these countries and the already developed countries. The primary producing nations included Latin America, Asia and Africa states. This depression strongly pressed countries like Britain and Germany because they had a lot of loans obtained from United States. Employment in these ...
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