A survey of Relationship Between the Independence of Central Bank and Inflation of Iran

This paper tries to survey the independence of Central Bank of Iran and its relationship to inflation by using the data of 56 developing countries during 1990s. The results signifies that there are no significant relationship between inflation and the independence of central banks in these countries. In other words, according to the existing evidences, not all the developing countries with high degrees of independence in their central banks have low levels of inflation and it depends on factors such as financial markets development level, national income structure and the way the country meets its budget deficit. According to the results of the survey and based on the prevalent income resources situations in Iran and the underdevelopment of finaneial markets of Iran, the independence of the central bank of Iran requires more studies and before everything, financial markets and governments budget structure reform should be addressed.