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REASSESSING THE EFFECT OF FISCAL AND MONETARY POLICIES IN IRAN: THE ST. LOUIS EQUATION REVISITED

Vefa Moayedi
경제연구소 (Hanyang Economic Research Institute)|2013.12|Journal of Economic Development|제38권 제4호|pp. 123-141|DOI 10.35866/caujed.2013.38.4.005

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참고문헌

키워드

Monetary PolicyFiscal PolicyIranSt. Louis EquationTRAMO/SEATS
주제분류경제학

초록

The purpose of this study is to observe the effect of fiscal and monetary policy actions on the Iranian economy. The famous St. Louis equation, an econometric model with lagged independent variables, is the key model for this study. Interestingly, the findings are converse to what scholars found when examining Western countries, especially the United States. With regard to Iran’s case, monetary policy is much less effective than fiscal policy in stimulating permanent economic growth. It is suggested that government interference is the reason. Furthermore, these findings support the equation’s general validity and its application, due to its parsimonious construction.

Abstract

The purpose of this study is to observe the effect of fiscal and monetary policy actions on the Iranian economy. The famous St. Louis equation, an econometric model with lagged independent variables, is the key model for this study. Interestingly, the findings are converse to what scholars found when examining Western countries, especially the United States. With regard to Iran’s case, monetary policy is much less effective than fiscal policy in stimulating permanent economic growth. It is suggested that government interference is the reason. Furthermore, these findings support the equation’s general validity and its application, due to its parsimonious construction.

참고문헌 (33)

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