A Framework for the Optimum Oil Revenue Allocation in Iran; Dynamic Stochastic General Equilibrium Approach (in Persian)

The main objective of this study is to evaluate the impact of oil revenue shock on macro-economic variables, in the context of a DSGE model while considering features such as the requirements of infrastructure development and public investment inefficiencies in Iran. The research findings based on RBC model, show that oil revenue shock has increased the consumption, government spending (such as the current and capital expenditures) and have decreased the inflation in the short term, although because the oil shock transferred to demand side, this situation leads to decrease the inflation in medium term. Results revealed that when the oil revenue shock increases, the “National Development Fund” and consequently the share of credit granted to private sector will be raised. Besides, because of the structure of Iran’s economy including large unproductive activities and the crowding out effect of government activity in economy the increase in oil revenue has little effect on growth and development of production in non-oil producing sectors. Furthermore, the research findings also show that when the public investments inefficiency decrease, the investment in oil revenues has more positive effects on macro-economic variables such as public sector production.