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Estimating of the Equilibrium Situation of Iran’s Economy within RBC Models

Listed author(s):
  • Mehregan, Nader

    ()

    (Professor of Economics, Bu-Ali Sina University)

  • Isazadeh, Saeed

    ()

    (Associate Professor of Economics, Bu-Ali Sina University)

  • Abbasian, Ezatollah

    ()

    (Associate Professor of Economics, Bu-Ali Sina University)

  • Faraji , Ebrahim

    ()

    (Ph.D. Candidate in Economics, Bu-Ali Sina University)

Registered author(s):

    It seems to be essential, define and compute an equilibrium for the Iran’s economy in order to derive explicit predictions about the mechanism of Real Business Cycles in Iran. In this article, it is attempted to estimate some important parameters and functions of Real Business Cycle models in the equilibrium situation of Iran’s economy based on the model introduced by McCallum (1989). Therefore, first the key function of McCallum is conducted using the annual time series in the period of 1959-2012, then production, household utility and Technology functions are obtained. According to the results presented in this article, elasticity of production to capital asset is 0.47 and the persistency of economy’s technology shocks is 0.79. Moreover, the persistency of technology shocks in both agriculture and oil sector are higher than all other existing sectors. Furthermore, the time preference rate and discount factor are 0.11 and 0.90 respectively. The elasticity of consumption to Leisure in Iran is 1.85.

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    File URL: http://ecoj.tabrizu.ac.ir/article_4983_db06865244bff34ba4627aa65b93f1db.pdf
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    Article provided by Faculty of Economics, Management and Business, University of Tabriz in its journal Quarterly Journal of Applied Theories of Economics.

    Volume (Year): 3 (2016)
    Issue (Month): 2 (July)
    Pages: 1-22

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    Handle: RePEc:ris:qjatoe:0040
    Contact details of provider: Web page: http://www.ecoj.tabrizu.ac.ir/

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