Title: The impact of central bank policy on Thai banking development: the ARDL approach

Authors: Kanokporn Intharak; Surachai Chancharat; Jakkrich Jearviriyaboonya

Addresses: Faculty of Business Administration and Accountancy, Khon Kaen University, Khon Kaen, Thailand ' Faculty of Business Administration and Accountancy, Khon Kaen University, Khon Kaen, Thailand ' Faculty of Economics, Khon Kaen University, Khon Kaen, Thailand

Abstract: Impacts of monetary policy and macroprudential policy were investigated on macroprudential, foreign currency-based capital flow, and residency-based capital flow measures in relation to Thai banking development. Measurement of banking development including financial depth, financial stability, financial efficiency, and financial inclusion associated with the central bank policy was assessed from 2004 to 2019 using the ADRL-bounds testing approach. Results showed that monetary policy and tightened and loosened macroprudential policy posed significant positive and negative impacts on Thai banking development. Policymakers should implement changes carefully to reduce unintended consequences hampering the domestic banking sector, other domestic financial markets, and international financial markets.

Keywords: central bank; banking development; monetary policy; macroprudential policy.

DOI: 10.1504/IJEPEE.2023.136309

International Journal of Economic Policy in Emerging Economies, 2023 Vol.18 No.3/4, pp.283 - 295

Received: 20 Oct 2020
Accepted: 09 Mar 2021
Published online: 30 Jan 2024 *

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