مهدی فیضی

Inequality in income distribution and social class inequality are among the most serious challenges faced by societies. Revolutionary movements often strive to reduce inequality and establish a more just society. The social class inequality and unfair income distribution have adverse social, economic, and cultural impacts on the community. Therefore, one of the governments’ primary and essential tasks is to create equitable opportunities and address social inequalities. Therefore, it is necessary to identify the influential factors and define precise and reliable variables for measuring inequality.

In this research, various methods for estimating the Gini coefficient are applied. This thesis will employ panel data models to investigate the effects of variables such as employment rate in the service sector, per capita income, inflation, and government expenditure on the Gini coefficient.

The final results of this study demonstrate that: first, per capita income significantly negatively impacts income inequality in the studied provinces during this period. In other words, as the per capita income of provinces increases, the level of income inequality decreases. Second, according to the findings of this research, government expenditure in each province have a positive and meaningful effect on income inequality. As government expenditure increases, income inequality will also rise. Inflation also positively and significantly impacts inequality, as increasing inflation leads to higher income inequality among provinces. Finally, employment in the service sector has a positive and significant effect on income inequality in the Iranian provinces, meaning that as the employment share in the service sector increases, income inequality will also increase.

Income inequality does not solely encompass economic issues, it will also extend to a wide range of social, economic, and even political matters. For this reason, achieving social justice has been one of the most complex and significant responsibilities of governments throughout history. Establishing fairness and equality in society can lead to development goals, economic growth, prosperity, increased security, and overall societal well-being. To attain a reasonable level of income equality, it is imperative first to define a suitable index for measuring the extent of inequality that is precise, measurable, and reliable. Subsequently, it is necessary to identify the key and influential factors contributing to income inequality and, ultimately, take steps to reduce income inequality."The main objective of this research is to investigate the impact of employment in the service sector on income inequality in the provinces of Iran during the years 2011-2019. As the results have shown, throughout the study period, employment in the service sector has affected income inequality in the Iran's provinces. However, contrary to the results in most developed countries, employment in the service sector has worsened income inequality in provinces. There are multiple reasons for the results obtained. As explained in the theoretical background, a major contributing factor in developing countries like Iran is the prevalence of low-paying service jobs that attract many individuals. Many service jobs within this category do not require specialized skills or infrastructure, making them appealing to individuals seeking employment. Employing more individuals from this group in service jobs does not decrease income inequality. It may exacerbate income inequality within society.In all economies, service sector complements other sectors and facilitates the conduct of different activities, greatly influencing the quality of outcome. If educational, health, and recreational services are not available in society, the workforce will not be efficient, and desirable productivity will not be achieved, thus affecting the economy negatively. In addition, in production sector, service institutions have the highest efficiency in adding value to goods. Service institutions can be divided into three main categories: (1) primary institutions, including research and development institutions. (2) secondarty institutions that operate in activities such as engineering, legal, and consultancy services. (3) Final institutions that play a role in activities such as packaging, sales, and advertising. Another advantage of the service sector is related to education. The more educated the workforce, the higher the productivity level will be.The concepts mentioned above are just a few of the job advantages in service sector. Nevertheless, in most developing countries, including Iran, more attention is paid to the industrial sector. This is despite World Bank data showing that about 70-80 percent of employment in advanced countries is in service sector, and special attention is paid to that. Most fundamental discussions also revolve around employment opportunities there. Despite all the advantages and experiences of different countries, Iran has not been able to use the existing capacities in this sector effectively. Many policymakers still view the service sector as low-level jobs, brokerage, and intermediaries, which has prevented serious attention to this sector, even though the service sector includes profitable jobs and contributes significantly to the growth and development of the country. Employment in this sector can also help employment in the industrial and agricultural sectors achieve higher productivity levels.

Despite the importance and necessity of accurate statistics and appropriate sequence of data for economic analysis and policymaking, economic data in many developing countries, including Iran, are produced with low accuracy and frequency because of various reasons. Satellite images, especially night light images, with high accuracy and frequency has been used in recent years as an important source of information to estimate the level of economic activity in the world and specially in developing countries which have limited or not accurate data sets . In this paper, for the first time, a new generation of monthly night light data (VIIRS) has been collected, processed, refined and used to estimate the seasonal GDP of Iran. Results of this study show that using these data alongside with seasonal population estimation and seasonal dummy variables can achieve a very good estimation of Iran's Gross domestic product at the national level and hence these data are not manipulated they can be used for more purposes.

During making decisions in situations of uncertainty, people sometimes ignore some of the available information, display Keynesian Animal Spirit, and do not make rational decisions. The purpose of this paper is to measure the cycles of uncertainty from February 2017 to the end of December 2020. During this period, events such as the volatility of foreign policy had a significant impact on political uncertainty and, consequently, changed the economic decisions of society. For this purpose, considering the progress of the use of social networks and its impact on collective behavior, a part of the official Telegram media data was collected during the research period using the method of "observer-based text mining" entitled "increasing economic uncertainty" or " "Reducing economic uncertainty" was labeled. Then, using the "Support Vector Machines" algorithm, the machine learning process was completed in order to fully label the body. In the next step, the results were evaluated using historical intuition. The results of the effect of this index using the vector auto regression model on the return of the total equal weight index of capital market. The results show that the fluctuations of this index have a positive effect on capital market fluctuations.

Susceptibility to development requires domestic policy-making which would be consistent with the integrated global economy. By drawing on the Leftwich’s Developmental State theory as a theoretical approach, this study aims to assess the role of international environment as well as the foreign policy of Malaysia in the process of Malaysia’s economic development. This paper will respond to a question: What are the features of Malaysia’s international environment and, its foreign policy as well in its process of economic development. This research presumes that some contributing features and factors to economic development such as favorable international environment and also peaceful foreign policy activism (developmental foreign policy) were instrumental in Malaysia’s prosperity in its way to economic development. The research method used in this paper is the comparative (multivariate time series) method. Data gathering method is based on library sources. The main findings of this study indicate that susceptibility to development is possible through peaceful foreign policy as well as cooperative utilization of the international system in the era of globalization.

Among the factors affecting labor productivity, the shortage in food intake can seriously affect productivity. The purpose of this study is to examine the Poverty Nutrition Trap, which is rooted in the theory of efficiency wage, highlighting the importance of malnutrition and poverty. This study's data were obtained by survey and completed by questionnaire in 1395 among 220 households living in Shahid Ghorbani district of Mashhad. A simultaneous equation system was used to investigate the existence of the Poverty Nutrition Trap. The results showed that the residents' bundle of food was significantly different from the average urban and provincial households. Results also revealed that the studied area inhabitants had spent almost half of the average cost of meat for urban households of Khorasan Razavi province and Iran. This issue also arose for the expenditure on high nutrients, including milk, eggs, fruits, and vegetables. The simultaneous equations system results showed that despite the low use of nutrients by the inhabitants of this area, the cycle of nutrition-based poverty had not been formed among them, and inadequate nutrition has not led to the vicious cycle of reduced income, reduced productivity, and inadequate nutrition. Therefore, other factors influencing the formation of poverty in the region should be identified to propose appropriate policies to reduce poverty.

Some companies voluntarily disclose additional information in addition to disclosing minimum information in accordance with relevant standards and other laws and regulations. Voluntary disclosure or ethical disclosure is the disclosure that companies make in addition to the mandatory disclosure requirements. Information disclosure is always one of the most important factors in reducing agency problems and information asymmetry. In addition, adopting policies based on transparency and information disclosure is one of the most important factors in the process of optimal and desirable corporate governance. One of the most important benchmarks of corporate transparency in the present era is attention to social issues, sustainable development and sustainability. In this regard, the present study examined the relationship between dimensions of corporate power in voluntary disclosure of non-financial information and corporate sustainability performance. The statistical population of this study included all companies listed in Tehran Stock Exchange from 2008 to 1986 and the sample was selected through systematic elimination from the statistical population. According to the specified conditions, 112 companies were selected as the statistical sample of this study. It is worth noting that the hypotheses were tested by designing multivariate regression models. The results showed that firm strength as a moderating variable enhances firm performance.

Coordination between monetary and financial policies is essential due to the feedback effects of the policies as well as intertemporal decision-makings; As policies enforced by an institution may affect policies adopted by the another entity in a destructive manner, the welfare of the society may be reduced ultimately. Therefore, in order to achieve the desired economic goals, appropriate institutional arrangements and creating a mechanism for the adequate coordination between these policy enforcers is required. In this study, after modeling the structural equations of the Iranian economy, the optimal rule for the monetary and fiscal policymaker, in form of the different policy games, was extracted. then, the basic equations were estimated using the Generalized method of moments (GMM) over the period 2005-2016, and their parameters were used in games simulation (in three situations: normal game, Stackelberg leadership game, as well as cooperative game). The games were simulated using programming with Matlab software, and the value of the minimum losses incurred for each player and community was calculated. Comparison and analysis of the results shows that the best welfare is created by the cooperation of both monetary and financial institutions. But if it is not possible to establish a coordinating institution between the two, central bank leadership is suggested as the best interaction.

Drought stress limits zinc absorption by cereal plant because of reduction of root growth and development as well as declining zinc movement in soil. On the other hand, tolerance to drought needs enough available zinc for plant to well regulate expression of genes that are responsible for cell protection against drought stress. Moreover, zinc deficient plants unable to detoxify reactive oxygen species (ROS) under drought stress conditions. Hence, zinc deficiency along with drought lessen grain yield and its nutritional quality, which cause hidden hunger in billions people worldwide. Although, zinc fertilizers can solve the problem, but it is not a sustainable solution in drylands because of soil surface dryness, zinc fixation in clay soils, and fertilizer unavailability. Along with zinc fertilizers, cultivation of zinc efficient varieties will be a complementary and viable solution in drylands. Hence, breeding zinc efficient cereals is a sustainable and necessary method to improve grain yield and nutritional quality of people food in 2025. Zinc deficiency in crops is the most widespread micronutrient deficiency, with about 50% of the cereal-growing area worldwide containing low levels of plant-available Zn. Zinc deficiency in soils reduces yield and nutritional quality of cereal (e.g. wheat) and afflicts 1 billion people especially in many developing countries like Iran. Sustainable solutions can only be developed through agricultural system approaches such as plant breeding. Micronutrient enrichment traits are available within wheat genomes that could allow for substantial increases in Fe, Zn and without negatively impacting protein and yield. There is considerable genotypic variation both within and between cereals for micronutrient efficiency. A number of studies have demonstrated differential Zn efficiency in barley, suggesting that genotypic variation could be exploited in breeding programs to produce genotypes with higher Zn efficiency. Various mechanisms may explain Zn efficiency in crops, including increased Zn uptake, increased Zn availability in the rhizosphere due to release of root exudates, and more efficient internal Zn use. In wheat and barley, Zn-uptake capacity of roots is one of the mechanisms of Zn efficiency. Drought stress and zinc (Zn) deficiency are serious abiotic stress factors limiting crop production in drylands of Iran, but the interaction between Zn deficiency and drought stress has not been studied extensively. Zinc nutritional status of plants may affect the drought sensitivity of plants in different ways. Zinc-deficient plants use water less efficiently and are less able to respond to increasing soil water deficits by osmotic adjustment than plants that are supplied with adequate levels of Zn. Moreover, drought stress kills plants by inducing production of reactive oxygen species (ROS). An adequate Zn nutrition can be involved in detoxification of ROS, and it is also important for reducing the production of free radicals. Therefore, likely that drought stress-related yield loss is additionally accentuated when plants would simultaneously suffer from Zn-deficiency stress. On the other hand, the review of literature indicates that application of Zn fertilizers has a potential to increase availability of Zn to plants, which will result in enhanced drought tolerance.

Identification of the precise pattern of income distribution and factors affecting them is the main prerequisite for any policy to reduce inequality. Historical evidence and experiences of different countries show that unemployment and inflation together with minimum wage are some of the effective macroeconomic variables on income inequality. In this paper, based on rural household expenditure from 2001 to 2016, not only the Gini index but also the ratio of the wealthiest decile to the poorest decile as inequality indices of rural areas in different states has been calculated. Our result shows that inflation rate and the minimum wage have a significant negative effect on inequality indices while unemployment was not significantly stimulus on inequality. Moreover, based on our result, since cash transferred from the Iranian subsidy reform plan had a significant share in the income of low-income families increases a lot their expenditures while it was not a significant share of income for rich families and therefore did not have any effect on their expenditures. Hence, all in all, the Iranian subsidy reform plan decreases inequality in income distribution in years after implementing this policy.

The purpose of this study was to investigate the effect of religion on charitable donation of atheists. We used experimental method utilizing a post-test and a control group. The population of the present study was 314 students at Sharif University of Technology recruited in the second half of 2018 semester and randomly assigned to either the experimental (n=27) or the control (n=26) group. Then subjects answered some demographic questions (i.e., age, gender, and income) and some questions from the NEO Five-Factor Inventory, and were also primed using a research-made Religious Priming Tool. Then they were given an opportunity to donate money to Mahak Charity, while keeping the record of donation amounts. At the end, they reported their religious orientation again and answered questions to check their knowledge of the objectives of the experiment. Finally, we compared the median of the donations in two groups. The data analyzed using the non-parametric Mann-Whitney test due to the abnormality of data distribution. The results showed that highlighting religion had no effect on donation of the atheists. The experiment warrants further research for the purpose of a better understanding of mechanisms influencing prosocial behavior.

In addition to typical functions of money such as a medium of exchange, a means of evaluation, and storing the value of goods and services, it also has a symbolic character. Money due to its symbolic character can be used as a social goal in regulating interpersonal and intrapersonal relationships. On the one hand, priming is one of the most important ways to highlight the symbolic aspect of money. On the other hand, trust is one of the essential aspects of human relations. We conduct a trust game experiment on 511 fourth-grade girl students from the public schools in Mashhad. The results showed that children primed with money in the experimental group, on average, trust more than the control group.

Adverse selection appear when insured persons have information about their risk that is not observed by insurers. Under these circumstances, insurers are unable to identify customer risk and they are forced to offer the same contract based on the average of all their customers. It is clear that offering such a similar contract will be relatively more attractive to high-risk customers. In contrast, it is not very pleasant for customers who have less risk. This will gradually drive low-risk customers out of the insurance industry. The end result will be that such a situation will prevent a stable balance in the market and it allows the market to collapse completely. In the present study, the phenomenon of adverse selection, which is one of the side effects of asymmetric information, in the basic health insurance market in Iran, it has been studied and tested. To test the research hypothesis, that is, to confirm the existence of an adverse selection, household budget data between 1993 and 1994 have been used. Attempts have been made to make the model under the least parametric assumptions, to be able to test adverse selection in health insurance. Also, unlike all previous models, the uncertainty of repayment and its amount was considered in this model, which is much more consistent with reality. The results confirm the adverse selection in health insurance, health care and social security in Iran.

Drought stress and iron (Fe) deficiency are abiotic stress factors limiting crop production and its quality, especially in rainfed areas. With the aim of evaluation of genotypic variation for Fe efficiecny, 121 barley genotypes during the growing season of 2015-2016, a research farm was carried out at the agricultural research institute of the dryland (Maragheh) were studied under rainfed field conditions. . The experiment was conducted in square lattice. Based on ANOVA, there was significant differences among genotypes for seed Fe concentartion and content traits. The high range of variation for these traits showed that there is a great genotypic variation among barley genotypes. The existance of high general heritability (h2) for seed Fe concentration and content could be helpful in breeding for these traits under different environments. Seed Fe concentration had significant and positive correlation (r=0.63**) with seed Fe content. In short, the result of this study revealed the great genotypic variation among barley genotypes for Fe absorption and accumulation in seed. Moreover, the efficient genotypes could alleviate drought stress that will result in higher grain yield with Fe-dense grains under cold dryland conditions.

The purpose of this study is to determine the preferences of the central bank of Iran and the optimal monetary policy rule using the optimal control method. so, we assumed that monetary authorities solving an optimization problem in backward looking expectation framework with regard to the constraints of the economic structure, which includes four equations of aggregate supply, aggregate demand, money demand and government expenditures. using Ordinary Least Squares (OLS) and Seemingly Unrelated Regression Method (SUR), for the period of 1979-1397, the preferences of the monetary authorities that minimize the amount of Social welfare losses, were selected. The results indicate that the central bank should consider the deviation of monetary growth rate and then the output gap. Also, the optimal rule of monetary policy derived from the optimal preferences indicates that the central bank must react simultaneously to the changes in inflation, output gap, real exchange rates, government expenditure growth, oil and tax revenues growth.

With the formation of the Safavid government, For various reasons, such as political, social and religiousMany Iranian elites, Like followers of Sufi creeds, Forced to flee home and migrate to other parts of the Islam world, especially the Indian subcontinent,infact, Specific conditions have arisen in Iranian Safavid community, Such as the presence of Shiite scholars from some parts of the Islamic world in Iran, Their intellectual  differences and criticism of Sufism, Creating disagreements, Between the Safavid kingdom and the protection sufis, in spite support of the Safavids for the long time, at this stage,They became their rivals, and in thise period Provided decline of Sufism conditions,In fact, In this change of approach, from Sufi Shiism, to the Shi'ism, many ofSuficreedssuccumbed to this ideological change, Along with this situation,Suitable conditions in the subcontinent, Particularly religious tolerance and material and spiritual protection ofimmigrants,with the governorates of this region, such as Gurkhanis, and other regional governments,The cause and the source of the vast majority of Iranian Sufi elites came to this area. This paper, by using an analytical descriptive method, seeks to answer this question: what factors in the Safavid period have contributed to the motivation of the migration of the Sufi Tories?.
  With the formation of Safavid government, a lot of elites from Iranian society, such as proponents of Sufi Tarigha, were forced to leave home and migrate to other regions of the Islamic world, including the Indian subcontinent. In fact, certain conditions have been arisen in the Iranian society of the Safavid era, such as the presence of Shiite Ulema from some regions of the Islamic world in Iran, (Farhani Monfared, 85: 1996), their thought and intellectual dissensions (Mazavi, 152: 1984), sharp criticisms of Sufism (Hedayat, 375: 2006, Hossein Zade, 38: 2000), and the emergence of differences between the Safavid kingdom and their supporting Sufisas the internal factors of immigration which at that time became their rivals,severely weakened one of the most important pillars of the Safavids power, both in the Tarigha period and in the period of their movement and government (Falsafi, 183: 1968), In this situation, the Safavid Tarigha, changed from Sufi Shi'ism to Shi'ite Faqih, and as a result, many Sufi Tarigha, became the victims of this ideological change. In parallel with this unfavorable domestic situation, the proper conditions existing in the sub-continent which was the main external factors of migration, led to the migration of many Iranian Sufi elites to the region. Meanwhile, the religious tolerance and material and spiritual supports of the governments of this region, including the Gurkhanis, as well as the sultans of some regional governments, have been heavily influenced by the motivation of immigrants (Razi, 61: 2012). Hekmat also explains that Sufi’s thoughtscoming from Irannot only influenced Indian culture and thought, but alsoimpressed themselves (Hekmat, 52:1958). With this explanation, the main purpose of this paper is to clarify the existing ambiguities in various aspects of these migrations, Because the vast exodus of Sufis and sympathizers of Iranian Sufis to India during the Safavid period is considered to be a catastrophe that, with the clarification of its nature, many of these ambiguities will be eliminated. Indeed, despite the investigations carried out by researchers in various respects, this issue remains uncertain. Therefore, the main question in this paper is that during the Safavid period, what factors contributed to the motivation for the migration of the Sufi Tarigha from Iran? In connection with this, the hypothesis has been madethat the source distracting factors and destination attractors have been effective in shaping the migration of the followers of this trend. The research methodology of this paper, based on the nature of the subject, is analytical-descriptive and the method of data collection, is in the form of a library researchin which, it has been tried to usethe relevant resources, to discuss the main reasons for this important historical event and its main aspects, external and internal factors that have occurred in Iran and beyond its geographic region during the Safavid period. The political power of Safavid should be considered the beginning of the decadence of Safavid Sufism. Especially, after the establishment of the Safavid dynasty, they considered themselves the partner of the power and misused the status of the Safavid government(EskandarBeike Monshi, 122:1987). As a result, from the very beginning of the political life of the Safavids, between the perfect Master who became a despotic kingdom of the Safavid government, and their supporting Sufis, a challenging situation was emerged and the perfect Master sought to weaken and eliminate this unwanted partner through various means and methods(Falsafi, 183: 1968). In other words, moral degradation brought the situation of the Sufis to a place where, in many cases, they were treated with violence and humiliation (Brown, 85: 20: 1990). Yet, the participation of the jurists in the Safavid government left a deep impression on Shi'a political jurisprudence. In fact, with the arrival of Shiite scholars to Iran (Farhanimanfard, 85: 1996, Mirahmadi, 54: 1990), the Shiite jurisprudential discourse emerged from Sufi Tarigha and became the dominant discourse of the political and religious structure of the Safavids. Hence, the role of the jurists in the legislature, which was preceded by a customary aspect, evolved on the basis of the Shi'a ruling. (Najafi, 51: 2009). On the other hand, the formation of Muslim regimes in India provided very good conditions for the attraction and activity of followers of the Sufi Tarigha as the external factors of immigration.Aside from these supports, the good conduct of the Sufis with other social groups has had a profound effect on the growth and expansion of the Sufi Tarigha in India. In fact, the development of Sophism in the sub-continent is a result of Sufis effort in learning local languages and their acquaintance with Indian mystics, and the similarity of Indian thoughts with the Sufi mystics, as well as their attempts to learn and apply some Indian practices such as reverse prayers, self-locking method and others, have been the most important factors in the region's attitude toward mysticism (Bojnordi, 445: 2001). Furthermore, it should be noted that the Sufi established good relations with Muslims and non-Muslims, particularly those of Hindus, and due to some teachings such as equity and equality, virtue, and hospitality were noticed by people.
  Safavids, although at first in the guise of mysticism, began to form their government, but from the very beginning of their reign, the confrontation between Shiite and Sufi teachings provided the ground for gradual decline and the marginalization of Safavid Sufism. In fact, Safavid kingdom immediately became aware of the fact that their supporting Sufis, who at various stages of their alliance, did their utmost to bring powerto Safavids, became a real rival in the new political structure, so they made constant attempt to limit and eliminate this competitor.Meanwhile, the most important and most effective instrument used by the Master of Tarigha, who became the king during the reign, was to take advantage of the new approach in the form of the ideas of jurists who also considered Sufism as their serious rivals in this field. In this approach, the Shi'a jurisprudents denied Sufis who were from various social, scientific, literary and cultural groups and wrotea number of rhetoric against them, a problem that had been less common in Iranian history. In this situation, the establishment of two important centers of power - the institution of monarchy and the institution of the Shari'a - together, created a complicated situation for the Sufis. In fact, in this approach, Shiite scholars used all their theoretical and practical efforts to completely eliminate rival discourse from the religious beliefs of the general public and the Safavid government, which brought significantsuccess. Therefore, the emergence of these complicated conditions for Sufi Tarigha in the political geography of Iran, led to the recognition of immigration to India as the most important solution. Thus, they came to a land that can be considered a part of the cultural geography of Iran, a land which, due to the presence of powerful supporters, the present state dynasties, as well as the appropriate cultural and social conditions, provided a suitable platform for these migrations and has led to the excellence of Sufi Tarigha in this land.In other words, all these factors, together with the lack of security in the society, which was in the midst of decadence, led to the widespread migration of elites and various social groups, which could be interpreted as a phenomenon of brain drain that is caused by unfavorable social conditions.

Border Rivers, as one of the most important natural terrain, are always the source of many differences in relations between states. The Hirmand River is the main artery of the Hamoon Lake, the borderline between Iran and Afghanistan, which has caused many border controversies between the two countries to this day. Failure of Afghanistan's to adhere to 1973 agreement to provide the water right of the Hirmand River, and hence the land of Hamoon, as a lake that Sistan's life is dependent on, has exacerbated the increasing challenges in the Sistan region. There has been a lot of negotiation between Iran and Afghanistan. Authors intend to answer the question of what are the strategies of diplomacy for providing the water right to the Hirmand River between Iran and Afghanistan. In the framework of game theory, in the first stage, the Hirmand Water Crisis should be considered as an important priority in the field of Iranian policy. Then, in the process of negotiations between Iran and Afghanistan based on diplomacy, the rationality of actors, Afghanistan’s access to the Chabahar port and the provision of the Hirmand water right as the point of equilibrium and the best option for both countries.

The purpose of this study is to estimate a “hybrid” version of the optimal monetary policy rule in Iran using the optimal control theory. To do this, it is assumed that monetary authorities solve an optimization problem with regard to the constraints of economic structure, which includes five equations of aggregate supply, aggregate demand, exchange rate, demand for money and government expenditure. First, the structural equations’ parameters are estimated using ordinary least squares (OLS) and seemingly unrelated regression (SUR) methods during 1978-2016. Then, the preferences of the monetary authorities for stabilizing inflation and output, and smoothing liquidity growth are chosen with the aim of minimization of social welfare loss. The results indicate that the central bank should consider the deviation of monetary growth rate and the output gap. In addition, the optimal rule of monetary policy derived from the optimal preferences indicates that the central bank must react simultaneously to the changes in inflation, output gap and real exchange rate, in which the role of output gap is of great importance.