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Survey the Dynamic of Inflation in Iran Since 1990

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  • Mohammad Mirbagherijam

Abstract

This paper surveys the dynamics of inflation and money growth in IRAN economy since 1990. We use the error correction model (ECM) approach and the quantity theory of money (QTM) as a general theoretical framework to examine the complex interaction among money growth, economy growth and inflation rate in the short-run and long-run. The sample of data has been since 1990:Q2 to 2011:Q1. And the results of estimation show that, inflation is not a monetary phenomenon, but it is mainly Cost-Push problem in the long-run. This empirical result is conflict to the famous statement by Milton Friedman that ‘inflation is always and everywhere a monetary phenomenon.

Suggested Citation

  • Mohammad Mirbagherijam, 2014. "Survey the Dynamic of Inflation in Iran Since 1990," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(6), pages 210-224, June.
    • Handle: RePEc:hur:ijarbs:v:4:y:2014:i:6:p:210-224
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    References listed on IDEAS

    as
    1. Claudio Morana & Fabio Cesare Bagliano, 2007. "Inflation and monetary dynamics in the USA: a quantity-theory approach," Applied Economics, Taylor & Francis Journals, vol. 39(2), pages 229-244.
    2. Osorio, Carolina & Unsal, D. Filiz, 2013. "Inflation dynamics in Asia: Causes, changes, and spillovers from China," Journal of Asian Economics, Elsevier, vol. 24(C), pages 26-40.
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    Cited by:

    1. Mohammad Mirbagherijam, 2014. "Thresholds Effect of Money Growth on Inflation in Iran," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(9), pages 319-329, September.

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    More about this item

    Keywords

    Inflation; Monetary Policy; Quantity theory of money; Co-integration; IRAN Economy;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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