There is no evidence that previous studies, available to Iran’s inflation literature, have used spectral methodology to analyze a possible relationship between inflation and its main determinants within a specific period. Accordingly, the present study investigates the effects of money growth, real output growth, output gap and interest rate changes on inflation at low and high frequencies...

Real interest and inflation rates have been very low in many industrialized countries since the Great Recession. In this paper, a mechanism of low and floating real interest and inflation rates is examined based on the concept a “Nash equilibrium of a Pareto inefficient path” and the law of motion for trend inflation. I show that, because the link between the marginal product of capital and the...

Abstract T he relationship between public sector deficits and inflation is one of the important and controversial issues in the academic literature as well as in economic policy field. On the other hand, a major objective of macroeconomic policies is to foster economic growth and to keep inflation on a low level. So keeping the price stability plays an important role in de...

This paper uses a cross-state panel for the United States over the 1976 to 2007 period to assess the relationship between income inequality and the inflation rate. Employing a semiparametric instrument variable (IV) estimator, we find that the relationship depends on the level of the inflation rate. A positive relationship occurs only if the states exceed a threshold level of inflation rate. Be...

iran’s economy has experienced an average inflation rate of 18.77 percent during the period of 1979-2010. many economists believe that the budget deficits are one of the main determinants of the chronic and relatively high inflation. this paper investigates the relationship between budget deficits and inflation. dynamics of iran’s monetary sector, based on the three cointegration relations i.e....

The bank interest rate is one of the most important macroeconomic variable in each country economic. The purpose of this paper is find the relationship between the facility interest rate and three main variable of the money market.In Iran. this issue for equations the interest rate facility, the interest rate of deposit, inflation and credit risk utilizing the model simultaneous equation system...

The real rate of interest indicates borrowing costs (or the return on an investment in financial assets), disregarding price increases. The expected real interest rate is important to investments, consumption and savings, and is therefore significant in the evaluation of economic prospects. The problem is that since the inflation expectations of investors and borrowers are not known, it cannot ...