The effect of Expansionary Monetary Policies on Corruption in Iran

Corruption is one of the main realities for oil countries and especially for Iran's economy.. Based on this, many studies and researches have been conducted in relation to investigating factors affecting corruption in different countries. The present study investigates the long-term and short-term effects of expansionary monetary policy on corruption by using the statistical evidence of Iran's economy for the period of 2015-2018 and applying the ARDL econometric approach. The results of the estimates show that the ratio of liquidity to GDP has increased corruption due to the creation of rent in the economy, but the favorable quality of institutions can improve the effective direction of liquidity towards activities with higher added value, causing a positive effect of liquidity on the reduction be corruption In fact, what can be said about the relationship between liquidity and corruption is the incorrect direction of money towards activities without added value and rent, which has caused an increase in corruption in the economy. Also, the estimates show that the increase in the size of the government has caused an increase in corruption due to its nature, inflation has caused an increase in corruption due to economic instability, And finally, human capital has reduced corruption due to the increase in labor productivity and the increase in the level of social class of people., and it requires a long-term plan to fight corruption, and short-term policies cannot be considered as a desirable solution.