Payame Noor University Economic Growth and Development Research 2228-5954 15 57 2024 12 21 Analyzing the Effect of Economic Shocks and Optimal Monetary Policy on Welfare in the Iranian Economy with Dynamic Stochastic General Equilibrium (DSGE) Analyzing the Effect of Economic Shocks and Optimal Monetary Policy on Welfare in the Iranian Economy with Dynamic Stochastic General Equilibrium (DSGE) 170 151 11578 10.30473/egdr.2025.72959.6923 FA Mostafa Eskandari Ph.D. Student, Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Abbas Memarnejad . Assistant Professor , Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Hoseini Seyed Shamsoldin Associated Professor, Department of Economics, Faculty of Economics, Allameh Tabataba'i University, Tehran, Iran. Journal Article 2024 12 03 Monetary policies are a set of decisions and actions of the country's monetary authorities to influence the level of economic activities. The aim of the present study was to analyze the effect of optimal monetary policies in the Iranian economy on welfare using the Dynamic Stochastic General Equilibrium (DSGE) model. The research method is analytical-descriptive and applied.The implementation method was analyzed using data taken from the Statistical Center of Iran and the Central Bank.The results showed that this type of optimal monetary policies had a direct impact on the entire economy and welfare.The results showed that the Central Bank, by enacting optimal monetary policies, has created a significant impact on the rate of economic growth;during this period (2011-2022), economic growth has improved by 0.5%, 1.5% and 2%.Therefore, it can be stated that by adopting optimal monetary policies, total production increases and consequently the employment rate increases.The wage rate has been increasing;therefore, economic growth improves.By analyzing economic shocks, it can be stated that the entire economy is affected by these types of shocks;therefore, monetary policies should be adopted in a way that they do not have a negative impact on the economy.As stated in economic shocks, the shock caused by an increase in the exchange rate increases inflation and affects other economic variables.The shock caused by an increase in oil production and also an increase in foreign assets cause economic growth. Monetary policies are a set of decisions and actions of the country's monetary authorities to influence the level of economic activities. The aim of the present study was to analyze the effect of optimal monetary policies in the Iranian economy on welfare using the Dynamic Stochastic General Equilibrium (DSGE) model. The research method is analytical-descriptive and applied.The implementation method was analyzed using data taken from the Statistical Center of Iran and the Central Bank.The results showed that this type of optimal monetary policies had a direct impact on the entire economy and welfare.The results showed that the Central Bank, by enacting optimal monetary policies, has created a significant impact on the rate of economic growth;during this period (2011-2022), economic growth has improved by 0.5%, 1.5% and 2%.Therefore, it can be stated that by adopting optimal monetary policies, total production increases and consequently the employment rate increases.The wage rate has been increasing;therefore, economic growth improves.By analyzing economic shocks, it can be stated that the entire economy is affected by these types of shocks;therefore, monetary policies should be adopted in a way that they do not have a negative impact on the economy.As stated in economic shocks, the shock caused by an increase in the exchange rate increases inflation and affects other economic variables.The shock caused by an increase in oil production and also an increase in foreign assets cause economic growth. https://egdr.journals.pnu.ac.ir/article_11578_cfe2a604e9a54c118892adec3623881b.pdf