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:: Volume 27, Issue 91 (Quarterly journal of economic research and policies 2019) ::
qjerp 2019, 27(91): 7-42 Back to browse issues page
The Effect of Unification of Exchange Rate on Macroeconomic Variables in Iran Using the Computable General Equilibrium Model (CGE)
Golrooz Ramezanzadeh velis * , Soheila Parvin , Musa Khoshkalam Khosroshahi
Allameh Tabatabaei Universiy , g.ramezanzadeh87@gmail.com
Abstract:   (3759 Views)
There are several reasons for using the unification of exchange rate policy, which is usually associated with the devaluation.The extent of these policies' influences on the economy is very extensive, especially when the economy is relying on single-product exports and has high foreign-exchange reserves. These policies affect the demand side of the economy through the exports and imports channel and the supply side through the cost of imported intermediary and capital goods. This study examines the effects of exchange rate unification on production, relative prices, exports and imports at macro level and the effects of feedback between sectors of the economy of Iran using the CGE model based on SAM 1390. The results based on two scenarios i.e., 25% and 35% increase in exchange rate indicates that the relative price index significantly will be increased by 21% and 30% in each scenario. Besides, the production growth will be increased by 1.8% and 2.6%, respectively. The same holds true about the sectors. The largest increase in production is related to the "mining" sector. However, the "hotel and restaurant" sector will face even a drop in production. Furthermore, the most inflationary burden will be experienced by the agricultural and related industries.
Keywords: Unification of Exchange Rate, Devaluation, Production, Relative Prices, Computable General Equilibrium (CGE)
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Type of Study: Research | Subject: Special
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Ramezanzadeh velis G, Parvin S, Khoshkalam Khosroshahi M. The Effect of Unification of Exchange Rate on Macroeconomic Variables in Iran Using the Computable General Equilibrium Model (CGE). qjerp 2019; 27 (91) :7-42
URL: http://qjerp.ir/article-1-2405-en.html


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Volume 27, Issue 91 (Quarterly journal of economic research and policies 2019) Back to browse issues page
فصلنامه پژوهشها و سیاستهای اقتصادی Journal of Economic Research and Policies
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