Inflation Behavior in the Iranian Economy under Macroeconomic Shocks: The DSGE Approach

Proper understanding of the concept of inflation and the factors affecting it is essential to achieving price stability. Despite the same general understanding of the concept of inflation, there is still no consensus among economists on the causes, so in recent years, many empirical studies in the country have identified and examined the factors affecting inflation. Since inflation is affected by various macroeconomic variables, this study has addressed this issue using the DSGE model. The data used were quarterly between 2002 and 2016, when the response of inflation to the shocks of monetary policy, fiscal policy, currency and stock price index was positive; In contrast to import tariff rate shocks, oil revenues and overall productivity have been negative. Among the shocks, monetary policy shocks have also had the most impact.Keywords: Inflation, Shock, DSGE