Appropriate Monetary and Financial Policy Framework to Achieve Inflation Targeting with an Emphasis on How to Manage Oil Revenues in Iran: an Approach DSGE

Document Type : Research Paper

Authors

1 PhD in economics University of Tabriz

2 professor of economics, University of Tabriz

Abstract

The aim of this paper is examining appropriate structures in order to achieve the objectives of monetary and fiscal policy in the Iranian economy. The behavior of monetary and fiscal policymakers was derived using dynamic optimization and game theory techniques trough defining objective functions and policy makers’ constraints under two basic policy making approaches: commitment and discretionary.
findings showed that,Regardless of committed or discretionary policymaking approach, fiscal policy has procyclical behavio. findings showed that, the hypothesis that oil revenues are only reason of fiscal dominance in Iranian economy is rejected and policy maker s commitment is necessary condition and fiscal discipline is sufficient condition for independence of monetary policy

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References

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Quarterly Journal of Applied Theories of Economics
Volume 9, Issue 2 - Serial Number 33
September 2022
Pages 223-244

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