Macroeconomic Development in Somalia and the Effect of Dollarization

This report examines the effect of dollarization on macroeconomic development in Somalia. It begins with an introduction to macroeconomics and its relevance to national economies, focusing on factors like economic growth, inflation, and unemployment. The research investigates the impact of dollarization on Somalia's economy, considering the country's unique challenges and its reliance on the informal economy. The report outlines the research questions, aims to evaluate the major aspects of Somalia's economy, and the influence of civil war on the country's infrastructure. The methodology section details the research approach, including the use of the research onion, a deductive approach, and a survey strategy with a sample size of 30 respondents. The report also includes references to relevant literature and resources used in the research.

The effect of Dollarization
on the macroeconomics
development in Somalia

Table of Contents
INTRODUCTION...........................................................................................................................1
Research Title:............................................................................................................................1
Background to research topic......................................................................................................1
Background to research organisation..........................................................................................2
Research questions:.....................................................................................................................3
Research aim and objectives:......................................................................................................3
Research Methodology................................................................................................................3
Timescale....................................................................................................................................5
Resources....................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Macroeconomics is basically a study of economics that consist of wider prospect as
inflation, economic growth, price level, gross domestic product, national income and difference
in between employment. It is processed as by maintaining clear focus and concern towards
national output, inflation and unemployment. The development of economy is dependent over
macro economist development that resulted into international trade, economic growth, fiscal rate
and with prospect of micro policies it is dependent over adequate study about health, education,
micro-finance and many other social programs as well (Edy-Ewoh and Binuyo, 2019). It get
examine the cyclical movements and trends such as unemployment, money supply, budget
deficit, inflation, exchange rates that has clear impact over state of economy over all the
members of society. The research below is based on the effect of dollarization with relation to
macroeconomics development within Somalia.
Research Title:
The effect of dollarization on the macroeconomics development in Somalia
Background to research topic
Macroeconomics is a factor that is dependent over fiscal, geopolitical and natural that
collectively affect both national and regional economy. It also get tend to impact a wider range
of swaths and its population as instead of selected few individual's for instance, economic output,
inflation and unemployment rate as well that collectively consist of monitoring of performance
with support of businesses, government and consumers alike. There is a certain balanced
relationship in between macro and micro economics as it also contributes to better economy as it
realm sustained study about decision making, customers, individual agents with respect to
economic behaviour along with adequate decisions that respective of larger scale market. For
example, different rules and regulation is processed with support of fiscal policy as it has direct
impact over impact over the triggering of potential aspects of international implication (Nor and
Masron, 2019). There is different factors of macroeconomics as in relation to negative factors
that jeopardize international and national economies as with the fear of instability about politics
that caused to nation's involvement of civil and international wars. It heighten the economic
turbulence as per reallocation of property damage, resources, livelihood and assets. In order to
unanticipated catastrophic events as like crisis that subsequently create a far reached ripple effect
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that also get resultant into strong capital preservation requirement at larger scale. It consist of a
different factors as it consider earthquake, natural disasters, flooding, brushfires and tornadoes.
Neutral factors of macroeconomics that has neither negative nor positive shift that rather
then precise implications as it used to determine intent actions as like trading, regulation all
across national and state boarders. It get enacts or rescinding with trading of embargo as it
trigger myriad with dependency of economic effects that is influential. In relation to positive
factors of macroeconomics it consist of sustained events which foster economic growth and
prosperity. For instance, the decrease price of fuel as it drive consumer purchase in relation to
retail and services (Bresser-Pereira, 2020). Moreover in the demand of different goods and
services is enhance with support of national and international suppliers as it invariably increase
revenue generation which ultimately drive stock price. In prospect of macroeconomics factor
cycle that more often has positive influence which also promote prosperity, enhancement of
demand that trigger price rates, suppress economy, household restrictive in terms of relations.
The development economic has maintained direct focus about to attain goal to enhance
economic, social and fiscal conditions as with this overall working suit-abilities of country is
developed.
Background to research organisation
Somalia is facing different challenge as with the quest with support of peace, economic
prosperity and stability. As the recent economy of country is measuredly dependent as per
informal economy and it furthermore also get based on remittance, money transfer, livestock
from abroad and mainly based on telecommunication as well. Somalia is usually a least
developed country as mots of its majority and population is being directly dependent over
livestock and agriculture as for its livelihood. In addition to this due to dearth of government
statistics and a civil war it is not possible to gauge a size and a growth of market economy. In
terms of international monetary funds the estimated economic activities is expanded as with
primarily driven sustained growth and development within both primary and secondary sectors.
As per concern of primary sector suitable growth that flourish adequate experience within
service sector that processed substantial impact over commercial activities and practices.
According to the United Nation Development Programme (UNDP) Somalia the country usually
had lowest indicator of development as with this “Strikingly low” index of Human resource and
with support of significant inequality within different social groups with drive of conflicts.
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Research questions:
 What are the key and major aspects of economy of Somalia which consists of its People
and society, Government, Military and security and Somali currency.
 What is the effect of dollarization on the macroeconomics development in Somalia.
 What is the influence of civil war on the collapse of the Somalia state along with how this
has weakened the country's infrastructure.
Research aim and objectives:
Aims:
To evaluate about the major aspects of economy of Somalia along with analysing the
effect of dollarization on the macroeconomics development in Somalia.
Research Objectives:
 To review about the key and major aspects of economy of Somalia which consists of its
People and society, Government, Military and security and Somalia currency.
 To determine about the effect of dollarization on the macroeconomics development in
Somalia.
 To have an evaluation about the influence of civil war on the collapse of the Somalia state
along with how this has weakened the country's infrastructure.
Research Methodology
It is a procedure that assist to develop adequate level of techniques and specification with
support of processing, selection, analysis, identification and relatedness of different information
about selected topic. In this it is easy to produce adequate level of knowledge as with this
authentic and systematic ending is resulted under which balanced level of productivity is
developed in timely frame (Prokop, Stejskal and Hajek, 2018). In this suitable knowledge about
Somalia is adjusted and for this researcher make adequate usage of research onion and it is as
briefly explained below as:
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Figure 1: Research Onion, 2020.
Research philosophies- It is usually get considered with support of different data and
information which is gathered, collected, analyses and used as per appropriateness. In also assist
to developed systematic outcome as for this a form of epistemology is considered under which
overall ability is analyses with relation to true aspect. It is opposed with support of doxology
under which sustained aspect and believe is considered that also get encompassed with research
approach. In order to process this research adequate usage of positivism philosophies is
considered as with this sufficient information is collected in order to perceived better
sustainability.
Research approach- It is a method that is used by researcher in order to interpret overall
situation as with this successful modification is processed with adequateness (Corrales and
Imam, 2019). In this all the relative information is segmented as per data collection and its
reasoning that is also get processed with support of qualitative, quantitative and mixed approach
and it is also get based on inductive, deductive and abductive approach. For this researcher make
supportive usage of deductive approach is used with support of numerical analysis in which easy
understanding of information is processed in effective manner.
Research strategy- It is a strategy that is used with support of better investigation as with
support of planning, monitoring, implementation and execution as with this profitable level of
advancement is processed in timely frame. For this adequate interview is processed, usage of
case study, quantitative survey, qualitative interview. In order to conduct this research survey
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strategy is used with support of questionnaire that assist to gain required information with
perfection.
Choices of method- It is dependent over the method as with this adequate information is
collected and for this researcher make adequate usage of quantitative method under which
authentic outcome is developed as with this standardized outcome is achieved with effectiveness.
Data collection and analysis- It is a process as within which primary as well as
secondary research is used as in terms of primary research questionnaire is used and in relation to
secondary research, literature review is conducted as with this profitable outcome and learning is
achieved with perfection.
Sample size- In order to process and conduction of the research suitable sample size is
selected that is of 30 respondents and information is collected as per basis of random sampling
method (Weber, 2019).
Analysis of data- It is a process which is used by researcher in order to collect data and
relative information with support of literature review as for this frequency table and pie chart is
analyze that offer better information.
Timescale
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Resources
These are the essential criteria that is used by researcher as in order to process its working
standards with certain flexibility and control (Letsa, 2018). In this researcher requires various
resource such as human resource, physical equipments, technological improvisation and financial
resources. For this adequate budget also get needed that assist to enhance durability and
effectiveness of researcher with balanced mode.
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REFERENCES
Books and Journals
Bresser-Pereira, L.C., 2020. New Developmentalism: development macroeconomics for middle-
income countries. Cambridge Journal of Economics. 44(3). pp.629-646.
Corrales, M.J.S. and Imam, P.A., 2019. Financial dollarization of households and firms: does it
differ?. International Monetary Fund.
Edy-Ewoh, U. and Binuyo, B., 2019. The Prospect of Dollarization in Nigeria: An Empirical
Review. International Journal of Business and Economics Research. 8(4). p.220.
Letsa, L., 2018. The Impact of a Dollar-based Economy on the Hospitality Industry: A
Theoretical Explanation and a Research Agenda. Journal of Economics, Management
and Trade, pp.1-9.
Nor, M.I. and Masron, T.A., 2019. Investigating the informal mode of financing utilized for
construction financing in Somalia: Some evidence. African Journal of Science,
Technology, Innovation and Development. 11(2). pp.223-233.
Prokop, V., Stejskal, J. and Hajek, P., 2018. Effectiveness of selected knowledge-based
determinants in macroeconomics development of EU 28 economies. In Finance &
Economics Readings (pp. 69-83). Springer, Singapore.
Weber, E.J., 2019. Copulas and Macroeconomics: the Quantity Theory of Money. Available at
SSRN 3456812.
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