Governments attempt to achieve the goals of low inflation rate and sustainable economic growth rate. The objective of this study is to analyze the roles of determinants such as the liquidity of money, weighted average of interest (profit) rate on banking deposits, exchange rate and the public debt on inflation and economic growth in Iran, using the quarterly data during the period of 1989-2008...

This paper characterizes Ramsey-optimal monetary policy in a medium-scale macroeconomic model that has been estimated to fit well postwar U.S.\ business cycles. We find that mild deflation is Ramsey optimal in the long run. However, the optimal inflation rate appears to be highly sensitive to the assumed degree of price stickiness. Within the window of available estimates of price stickiness (b...

In this research, non-linear inflationary dynamics based on the concept of missing money is studied using the threshold autoregressive models based on seasonal data of the time interval (1990:04-2016:07) for the economy of Iran. The finding of the research shows that simple and Divisia liquidity growth variables are determined as threshold variables, and inflation reacts to changes in the growt...

We determine optimal discretionary monetary policy in a New-Keynesian model when nominal interest rates are bounded below by zero. Nominal interest rates should be lowered faster in response to adverse shocks than in the case without bound. Such ‘preemptive easing’ is optimal because expectations of a possibly binding bound in the future amplify the e ects of adverse shocks. Calibrating the mod...

This paper assesses the effect of expected inflation and inflation risk on interest rates within the Fisher hypothesis framework. Autoregressive Conditional Heteroscedastic models are used to estimate the conditional variability of inflation as a proxy for risk. With the UK quarterly data from 1958:4 to 1994:4, we found that both the expected inflation and the conditional variability of inflati...

The main goal of the present paper is to analyze the effects of currency collapses (a large devaluation of country’s nominal exchange rate) on real gross domestic products of six Asian countries (Iran, Indonesia, Malaysia, Pakistan, South Korea, and Turkey). A yearly data is collected from the WDI of the World Bank over the period 1980-2011. The econometric model includes the real GDP growt...