Payame Noor University Economic Growth and Development Research 2228-5954 12 48 2022 09 23 Investigation Asymmetric Effects of Exchange Rate on Iran’s Gross Domestic Product - Nonlinear ARDL Approach Investigation Asymmetric Effects of Exchange Rate on Iran’s Gross Domestic Product - Nonlinear ARDL Approach 67 82 8180 10.30473/egdr.2021.61025.6320 FA Arshia FARAJI TABRIZI Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran Kambiz Hojabre Kiani Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran Abbas Memarnejad Department of Economics, Science and Research Branch, Islamic Azad University Tehran, Iran Farhad. Ghaffari Department of Economics, Science and Research Branch , Islamic Azad University, Tehran, Iran. Journal Article 2021 09 26 The aim of this study is to investigate the short-term and long-term asymmetric effects of exchange rate on Iran’s gross domestic product (GDP). Considering the importance of the issue in policy making and the possibility of influencing production through exchange rate, in this study, the effects of positive and negative exchange rate shocks on Iran's GDP in the short and long term with nonlinear distributed autoregressive lags (NARDL) have been investigated in the period of 1991 to the fourth quarter of 2018 and the "Shine et al" model is the main basis of the research. For this purpose, using explanatory variables of liquidity volume, exchange rate, degree of openness of economy, gross domestic capital stock, labor and oil prices, through band test confirms the existence of a long-term asymmetric equilibrium relationship and also confirms the results of asymmetric relationship between real exchange rate and GDP. In the short term, the decrease in real exchange rate leads to an increase in GDP and an increase in the exchange rate has negative and significant effects on GDP, and in the long run, the severity of negative shocks has been more than positive shocks, this effect has been positive and asymmetric. The aim of this study is to investigate the short-term and long-term asymmetric effects of exchange rate on Iran’s gross domestic product (GDP). Considering the importance of the issue in policy making and the possibility of influencing production through exchange rate, in this study, the effects of positive and negative exchange rate shocks on Iran's GDP in the short and long term with nonlinear distributed autoregressive lags (NARDL) have been investigated in the period of 1991 to the fourth quarter of 2018 and the "Shine et al" model is the main basis of the research. For this purpose, using explanatory variables of liquidity volume, exchange rate, degree of openness of economy, gross domestic capital stock, labor and oil prices, through band test confirms the existence of a long-term asymmetric equilibrium relationship and also confirms the results of asymmetric relationship between real exchange rate and GDP. In the short term, the decrease in real exchange rate leads to an increase in GDP and an increase in the exchange rate has negative and significant effects on GDP, and in the long run, the severity of negative shocks has been more than positive shocks, this effect has been positive and asymmetric. https://egdr.journals.pnu.ac.ir/article_8180_25164c8357ed7a8576265c07e705498b.pdf