analyzing the effects of energy price liberalization on the main macroeconomic variables of iran, within a structural macroeconometric model framework

a medium scale structural macroeconometric model is constructed to investigate the effects of energy price liberalization on the main macroeconomic variables. the analysis is conducted under 3 different scenarios of increasing the price of energy sources to the level prevailed in the countries of the persian gulf region. these 3 scenarios are a sudden increase, a gradual increase within a 5 years time span and a gradual increase in energy prices together with some compensation of household and the industry. the simulation results show that under the first scenario, inflation rate goes up to 94%, gdp growth rate reduces to 1.2% and unemployment rate rises to 11.5%. under the second scenario , in the first year of rising energy prices, inflation rate increase to 27.7% and gdp growth rates falls to 2%. if the third scenario is chosen, the inflation rate will increase to 95.2% in the first year, while gdp growth rate and unemployment rate will be 1.2% and 11.5% respectively. jel classification: h25, o47 e24,e23, e31, e37