TY - JOUR ID - 12262 TI - Investigating the effect of institutional quality (corruption) and lack of financial dominance (central bank independence) on optimal monetary policy using DSGE and STAR approaches JO - Quarterly Journal of Applied Theories of Economics JA - ECOJ LA - en SN - AU - ghadimi, maryam AU - rabiei, mahnaz AU - davani, abdolah AU - Shahabadi, Abolfazl AD - Islamic Azad University,Tehran South Branch,Tehran,Iran AD - Assistant Professor of Economics and Faculty member of Islamic Azad University,Tehran South Branch.Tehran,Iran AD - Assistant Professor of Economics and Faculty member of Islamic Azad University,Tehran South Branch, Tehran,Iran AD - Professor of Economics and Faculty member of Social& Economic Department,Alzahra University,Tehran,Iran Y1 - 2020 PY - 2020 VL - 7 IS - 3 SP - 241 EP - 280 KW - Keywords: Central Bank Independence (CBI KW - Smooth Transition Autoregressive (STAR) KW - Monetary Policy KW - Corruption KW - Stochastic Dynamic General Equilibrium Model (DSGE) DO - 10.22034/ecoj.2020.12262 N2 - Examining monetary policy as one of the channels affecting macroeconomic variables is one of the important issues in the economy. In the present study, using the non-linear model of auto regression with gentle transfer (STAR), the effect of corruption on monetary policy with respect to different levels of independence of the Central Bank of Iran has been investigated. The results, in addition to confirming the non-linear relationship between the independence of the Central Bank of Iran and the growth of money supply, show that increasing the degree of independence of the Central Bank has reduced the growth of money supply. In the second part , optimal behavior of optimal monetary policy is determined using the Stochastic Dynamic General Equilibrium (DSGE) model. The results show that fiscal dominance reduces the coefficient of optimal policy and the greatest stabilizing power of optimal monetary policy occurs in the state of complete independence of monetary policy. UR - https://ecoj.tabrizu.ac.ir/article_12262.html L1 - https://ecoj.tabrizu.ac.ir/article_12262_3de26d4e5882cbaf7de9b61788156b96.pdf ER -