Monetary Policy and Development in Emerging Economies

Abstract

An efficient financial market, macroeconomic stability, and inequality are fundamental to achieving sustainable development. This dissertation comprises three essays that address these themes through both theoretical and empirical approaches. The first chapter assesses the welfare impact of introducing a central bank digital currency (CBDC) in a developing country. We contribute to the literature by designing an environment more suited to emerging economies with an informal sector and a fraction of consumers who can’t access the financial sector. We show that interest-paying CBDCs can improve welfare, but can also reduce it under certain conditions common in developing countries. In the second chapter, we adopt an SVAR model with sign restrictions to estimate the effect of household inflation expectations on inflation dynamics across advanced and developing countries. In this exercise, we illustrate that expectations matter more in developed countries and highlight how agents in developing countries are more backwards-looking. In the final paper, we examine consumption, income, and wealth inequality in Nigeria. Using rental data, we develop a technique to adjust self-reported wealth data, which can be overestimated. One of our main conclusions from our analysis is that the rural-urban divide that is evident in other African countries is relatively muted in Nigeria, where regional inequality is a larger factor.

Date of Award	20 Jan 2026
Original language	English
Awarding Institution	University of Bristol
Supervisor	Arpad J Abraham (Supervisor) & Tai-Wei Hu (Supervisor)