To What Extent Do Oil Price Shocks Explain the Business Cylces of the Economy of Iran in a Dynamic Stochastic General Equilibrim Model Under New-Keynesian Assumptions?

Please enable javascript in your browser.

Taheri, Shamim | 2012

673 Viewed

Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 43170 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Nili, Masoud
Abstract:
In this thesis, a dynamic stochastic general equilibrium model under new-Keynesian assumptions has been proposed for the economy of Iran, as a major oil-exporting economy. The economy is supposed to be inhabited by households, firms (both final-good and intermediate-good producing firms), a government and a monetary authority. It is exposed to stochastic and exogenous shocks to total factor productivity, oil export revenues and the growth rate of money. The most important features of the model, which distinguish it from most other proposed models for the economy of Iran, are the assumptions of the presence of monopolistic competition in intermediate-good producing firms and also a degree of rigidity in their prices. The simulation results from DYNARE indicate that the oil revenues shock by itself explains about 10 percent of the business cycles of non-oil output in the economy of Iran. Moreover, the results reveal that in low income-tax rates, output volatilities increases as the tax rate rises, while the reverse holds in high tax rates
Keywords:
Real Business Cycle ; Oil Price Shocks ; Economic Fluctuations ; Oil-Exporting Economy ; Nominal Rigidities