Impact of inflation on economic growth in Bosnia and Herzegovina

Abstract

The objective of this research is to analyze the impact of inflation on economic growth in Bosnia and Herzegovina (BiH) from 2017 to 2023. Utilizing data on annual inflation rates and GDP figures, the study employs a correlational-regression analysis conducted with IBM SPSS software to examine the relationship between inflation and GDP growth. The results indicate a significant fluctuation in inflation rates, particularly with a dramatic spike in 2022, and a consistent upward trend in GDP growth, except for a minor decline in 2020 attributed to the COVID-19 pandemic. The regression analysis suggests that while high inflation in 2022 coincided with substantial GDP growth, the overall impact of inflation on economic growth appears complex and multifaceted, influenced by other underlying economic factors. The conclusion drawn from this study is that inflation in BiH has a nuanced relationship with economic growth, necessitating a balanced approach in monetary and fiscal policies to sustain economic stability and growth.

Keywords

• inflation
• economic growth
• bosnia and herzegovina
• gdp