Interaction of the real and Financial Phenomena in the Egyptian Economy (A Study in Methodology)

financial position

monetary policy

In developing countries where the financial markets are backward, the financial expert contribution in policy making may be questioned. Monetary and financial theories are developed to suit highly developed economies in both real and financial sectors. However, the policy maker whether in developed or a developing economy is facing the same problem; how to use financial instruments to accelerate the rate of growth of real income? Traditional instruments to achieve this target are available. Nevertheless, the scope of using them are quite limited in developing countries owing to their well known characteristics. This does not mean that the financial expert in a developing economy is helpless.