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:: Volume 30, Issue 103 (quarterly journal of economic research and policies 2022) ::
qjerp 2022, 30(103): 133-158 Back to browse issues page
Markov-switching analysis of exchange rate pass-through: Sugar Price in Iran
Ehsan Rajabi * , Ali Akbar Baghestany , Ebrahim Javedan
Agricultural Planning, Economic and Rural Development Research Institute,  , rajabi.ehsan63@gmail.com
Abstract:   (653 Views)
Due to its inherent role in ensuring food security and as one of the productive sectors of the economy, the agricultural sector has a priority in receiving preferential currency. Having a preferred currency has caused the price of this commodity in the market to be multi-valued. On the other hand, the allocation of billions of dollars at a price lower than the free market price of foreign exchange to imports makes the percentage of the effect of the preferred currency on the price of commodities more important. In such circumstances, it must be determined whether the allocation of preferential or bank currency (42000Rials) to sugar has been able to be transferred to the final price of this commodity. To answer this question, time series data with monthly frequency of domestic sugar prices, official exchange rates and world prices during the years 2011: 03-2019:11 and the nonlinear pattern of Markov MSIAH regime change have been used. The results showed that during the period 2011:03-2019:11, the average monthly growth rate of the price of this product was equal to 1.5 percent. Meanwhile, during the period of implementation of the preferential exchange rate policy, the average monthly price growth rate was equal to 2.7 percent. The results also show that in the short run, the exchange rate pass-through to sugar price in the second regime was significant and equal to 5%. In the long run, the exchange rate pass-through in this regime was equal to six percent.
Keywords: exchange rate, markov switching pattern, sugar
Full-Text [PDF 653 kb]   (193 Downloads)    
Type of Study: Research | Subject: Special
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Rajabi E, Baghestany A A, Javedan E. Markov-switching analysis of exchange rate pass-through: Sugar Price in Iran. qjerp 2022; 30 (103) :133-158
URL: http://qjerp.ir/article-1-3217-en.html


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Volume 30, Issue 103 (quarterly journal of economic research and policies 2022) Back to browse issues page
فصلنامه پژوهشها و سیاستهای اقتصادی Journal of Economic Research and Policies
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