CHAPTER III:
METHODOLOGY
3.1. Introduction
This chapter explains in few words how the research has been
conducted. It gives the plan, strategy research design that is required for the
study. Plan includes what is done from writing the hypotheses and their
operational implications to the final analysis of data. Strategy includes the
methods to be used to gather and analyze the data and implies how the research
objectives was reached and how the problems encountered will be tacked
(Kerlinger, 1973: 300)
The study covers the period of 1995-2010. It includes
explanatory variables that explain the money stock. These variables are
typically of those identified in most studies of role of central bank. The
money stock has been used as the dependent variable in the estimation. The
study employs an econometric technique of cointegration methodology. The data
that are used in this study are secondary data obtained from Ministry of
Economics and Finance, Rwanda National Institute of Statistics publications as
well as reports prepared by National Bank of Rwanda.
3.2. Data collection
3.2.1. Sources of data
Secondary data: data analysis in the
econometric part of this research requires data provided by different
institutions. As such, these data are secondary data. The National Bank of
Rwanda is the principally source of data on Inflation, GDP, exchange rate and
of course Money supply. So, figures on these indicators as well as on other
that could help specify an appropriate Taylor rule model have been collected at
the National Bank of Rwanda. But because a big part of the research deals with
the role of Central Bank on Rwandan economic development , the national bank of
Rwanda is not only a source of data.
Primary data: the methodology for
the compilation of the role of National Bank of Rwanda (NBR) at the beginning
of the research through monetary policy. So, staff from the national bank of
Rwanda provided useful information on how the Inflation, Money stock, GDP and
Exchange had been compiled during the period covered by the present research.
Because the researcher had difficulty of finding out that
piece of information, it became necessary to interview the staff in charge of
the research at the National Bank of Rwanda.
3.2.2. Data collection
procedure
Most of the data was collected from the NBR library. Where,
the staff was very helpful in the delivering the appropriate documents. Many of
the documents were annual reports, but some other reading materials, like
monthly publications; relevant to this study was also provided.
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