Domestic Savings, Money Supply and Economic Growth In Sri Lanka

English

Abstract

This study aims to investigate the impact of money supply, domestic savings and total debt ratio on economic growth.This study uses an annual research period of 48 years from 1972 to 2020 in Sri Lanka to estimate Sri Lanka's economic conditions and the impact of money supply, domestic savings, and debt-to-economy ratios in Sri Lanka. We use the second data in this study which is sourced from the world bank. This study uses the Error Correction Model (ECM) analysis. We found that the domestic saving ratio can encourage economic growth in Sri Lanka in terms of loanable supply where the increase in the amount of savings, the increased loanable supply which has an impact on lowering interest rates so that investment can increase and economic growth can be encouraged to grow.