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Investigating the effect of oil price instability on Iran's economic growth
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Gh. Ali Rahimi *   1, Melika Ashoori |
| 1- , alirahimigh2000@yahoo.com |
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Abstract: (173 Views) |
This article examines the effect of oil price fluctuations on Iran's economic growth. The research data are quarterly and cover the period from 1991:1 to 2021:4. For this purpose, first the oil price instability index is estimated using the GARCH model, then the mutual relationships between the model variables are examined using the vector autoregressive (VAR) method, and finally the long-term relationship between the variables is extracted using the Johansen cointegration method.
Based on the impulse response functions, the oil price shock has had a negative impact on production. Also, according to the estimated long-term relationship during the study period, the variables of private consumption expenditure, investment, and net exports have had a positive and significant impact on GDP, which is consistent with the theoretical basis of the research.
In the long run, the oil price variable has had a positive effect and the oil price instability has had a negative effect on GDP. Given the country's strong dependence on oil and oil revenues, the above results are acceptable. Another finding of the study is that the effect of an increase in oil prices has been significant in all cases and greater than the effect of a decrease in oil prices. The results also show that monetary shocks, along with oil price shocks, have a significant effect on GDP.
Keywords: GDP , GARCH Model, oil price volatility , Johansen cointegration test
Jel classification:Q32, E43
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| Keywords: GDP, GARCH Model, oil price volatility, Johansen cointegration test |
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Full-Text [PDF 1237 kb]
(71 Downloads)
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Type of Study: Research |
Subject:
قيمت گذاري
Received: 2024/08/19 | Accepted: 2024/11/27 | Published: 2024/12/30 | ePublished: 2024/12/30
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