Monetary Shocks
Niloofar Sadat Hosseini; Hossein Asgharpur
Abstract
The purpose of this study is to study Taylor's theory and investigating the effect of monetary shocks on macroeconomic variables assuming the degree of exchange rate pass-through in different inflationary environments. In this study, the dynamic stochastic general equilibrium model for a small open economy ...
Read More
The purpose of this study is to study Taylor's theory and investigating the effect of monetary shocks on macroeconomic variables assuming the degree of exchange rate pass-through in different inflationary environments. In this study, the dynamic stochastic general equilibrium model for a small open economy has been used. In this framework, effects of monetary shock were investigated in Iran during 1988:1˗2014:4. and the inflation regimes and the degree of exchange rate pass-through have been investigated using a smooth transmission regression model. The empirical findings show that Taylor's hypothesis is confirmed. In other hands, the degree of exchange rate pass-through is high in an economy with high inflation. Due to a monetary shock, volatility of macroeconomic variables is high, assuming a high degree of exchange rate pass-through in the inflationary environments.
Monetary Shocks
seyed abbas hoseini ghafar; rasoul bakhsi dastjerdi; majid sameti; Houshang Shajari
Abstract
The purpose of this study is to investigate wheatear fiscal expansion of monetary policy leads to inflation and what are its short-term and long-term consequences on the economy. The results showed that the consumption, production, and investment variables will be negatively affected by this mode of ...
Read More
The purpose of this study is to investigate wheatear fiscal expansion of monetary policy leads to inflation and what are its short-term and long-term consequences on the economy. The results showed that the consumption, production, and investment variables will be negatively affected by this mode of financing in the long run. The findings of policy shock functions indicate that increasing in the money stock leads to increase in the short term investment but reducing household labor hours will reduce production because of inflation. For example, increasing in the amount of a standard deviation would increase the inflation rate by 1.157 % as well as it would reduce household labor hours, real money balance, production and consumption respectively by 0.062%, 0.157%, 0.0368%, and 0.157%. On the contrary, this policy will increase capital by 0.264% and investment by 6.3%.
Monetary Shocks
Asghar Abolhasani; Ilnaz Ebrahimi; Mohammad Hossein Pour Kazemi; EBRAHIM BAHRAMI NIA
Volume 7, Issue 25 , November 2016, , Pages 113-132
Abstract
Prices as the most fundamental variable in the housing sector have the task of optimizing the allocation of economic resources. Statistics show that during the period under the study (1991-2011), housing sector in Iran has experienced four jumps in prices. In this paper, we build a Dynamic Stochastic ...
Read More
Prices as the most fundamental variable in the housing sector have the task of optimizing the allocation of economic resources. Statistics show that during the period under the study (1991-2011), housing sector in Iran has experienced four jumps in prices. In this paper, we build a Dynamic Stochastic General Equilibrium (DSGE) model to study the fluctuations in prices and output of housing sector and identify the effects of monetary and oil price shocks on this fluctuations. The impulse response functions show that higher money growth rate temporary increases output and inflation in the both housing and nonhousing sectors. In addition, due to the higher elasticity of supply in the nonhousing sector, the effects of monetary shock on production in this sector are more than the housing sector. Higher oil revenues through increased liquidity and then increasing demand of private sector causes higher inflation in the economy. The results show that a shock in oil revenue temporary increases production and inflation in the housing and nonhousing sector simultanously. The difference is that the inflationary effect of this shock is higher than its effect on the production. Altogether, the comparison of the moments of the model and its impulse response functions with that of real world shows that our model can well illustrate the cyclical fluctuations of most important variables in the housing and nonhousing sectors.
Monetary Shocks
Hamid Mohammad Roshani
Volume 6, Issue 23 , May 2016, , Pages 74-59
Abstract
The structure of Iran’s economy is based on the revenues of oil sale so that the major macro economics variables such as foreign export revenue and then foreign exchange revenue and reserve, imports, budgeting are always set based on it. Hence the effect of this revenue has being surveyed among ...
Read More
The structure of Iran’s economy is based on the revenues of oil sale so that the major macro economics variables such as foreign export revenue and then foreign exchange revenue and reserve, imports, budgeting are always set based on it. Hence the effect of this revenue has being surveyed among monetary officials seriously. Iran’s oil revenue causes increasing in foreign exchange reserve or change to the country’s currency in the budget deficit mode and consequently increases liquidity. Because the increase of liquidity has not been by productive activity, it caused so many economic failures in Iran. Using a 50 years time series data of macroeconomic variables, the main purpose of this survey is investigating the degree of effecting liquidity and its component by revenue of oil sale vai an econometric OLS model to verify how the revenue of oil sale motivates the liquidity and it’s components. In this case we can find the ways of managing and programming the revenue of oil sale as an exogenous variable to control the effects of disordered liquidity.
New Keynesians
Sohrab Delangizan; Ali Falahati
Volume 1, Issue 3 , January 2012, , Pages 163-136
Abstract
One of the most important macroeconomic discussions is the effects of monetary policies on the real section of economy. With this respect, the present article investigates the asymmetric or symmetric effects of monetary shocks on the economic growth of Iran. In this article, the relevant model extracted ...
Read More
One of the most important macroeconomic discussions is the effects of monetary policies on the real section of economy. With this respect, the present article investigates the asymmetric or symmetric effects of monetary shocks on the economic growth of Iran. In this article, the relevant model extracted from macroeconomic literature of money in Iran's economy is being examined. The results demonstrate that money isn’t neutral in Iran's economy and the effects of monetary policies on growth of Iran's economy are asymmetric. The negative monetary shocks influence the economic growth more than the positive monetary shocks; so that the negative monetary shocks in boom cycles and the positive monetary shocks in recession cycles have more significant effect on the economic growth. According to the result, it can be demonstrated that the effects of monetary shocks on economic growth is larger and more asymmetric if the shocks are bigger, and the lower the monetary shocks, the less the effects, consequently the asymmetry of negative and positive shocks will be slight. Also there are information gaps between economic makers so that the expectations are not formed rationally in Iran. So according to the results, it can be concluded that Iran's economy is in agreement with the Keynesian economics.