Document Type : ORIGINAL ARTICLE
Author
Assistant Professor, Faculty of Literature and Humanities, University of Guilan, Rasht, Iran.
Abstract
The impact of inflation uncertainty on the real sector is one of the topics of monetary economics, which leads to important effects at the macroeconomic level. Despite this, there is no consensus on how inflation uncertainty affects output in the field of theoretical and empirical studies. On the other hand, considering the conditions of countries with natural resources rent, this relationship may be challenged. Therefore, the current research tries to provide a new insight in this field by choosing Iran's economy due to the experience of wide inflation fluctuations on the one hand and the special role of oil revenues on its various sectors. For this purposedata from 1989:2 – 2021:2 and continuous wavelet transformation were used to examine the relationship between uncertainty of inflation and output by different groups.The results showed that in the short-run horizon, the gross domestic product and its components have experienced various relationships in terms of intensity, direction and flow of causality with inflation uncertainty. In the medium and long run, the gross domestic product due to oil revenues has an inverse effect on inflation uncertainty. Based on this, it can be said that achieving one of the important goals of monetary policy is dependent on the real sector and specifically oil rent. This problem is rooted in the high concentration of oil in Iran's economy and its direct and indirect influence on liquidity, which reflects the lack of independence of the central bank.
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