Appraising the Impact of Rule of Law, Control of Corruption, and Govt. Effectiveness on Inflation: An Empirical Case of Bangladesh

This study is an effective initiative to find out the impact of noneconomic determinants as well as the importance of noneconomic determinants on inflation in Bangladesh. Time series data was used from 1996 to 2020. The unit root test, on the other hand, indicates that the stationary at the first difference of all variables indicates I(1). Cointegration results ensure long-run associations among variables. The econometric methods apply the Generalized Linear Model (GLM) technique for measuring the importance of noneconomic determinants for controlling inflation. Findings show the importance of noneconomic determinants to controlling inflation, where the controls of corruption, the rule of law, and government effectiveness have influenced the reduction of inflation in Bangladesh. It should be focused on improving the quality of noneconomic performances and emphasizing the significance of those factors through the implications of rules and regulations, digitalization, and ensuring open-door services and accessible information for all consumers of goods and services. Further study may consider the other noneconomic as well as macroeconomic determinants that have a large contribution to determining inflation in Bangladesh.