Financial Inclusion and Monetary Policy in Iran (in Persian)

Alireza Fardhariri (), Ali Taiebnia () and Hossein Tavakolian
Additional contact information
Alireza Fardhariri: Faculty of Economics, University of Tehran, Iran.
Ali Taiebnia: Faculty of Economics, University of Tehran, Iran.

The Journal of Planning and Budgeting (٠صلنامه برنامه ریزی و بودجه), 2022, vol. 27, issue 2, 51-88

Abstract: The present study investigated the effectiveness of monetary policy and its consequences for financially included and excluded households using a calibrated new Keynesian dynamic stochastic general equilibrium (DSGE) for Iran. The impulse response function analysis suggests that although a significant part of the population is financially excluded (about 45%), the contractionary monetary policy shock significantly reduces inflation and GDP. In addition, a contractionary monetary policy decreases the consumption of financially excluded households more than that of financially included households, because financially included households can absorb this shock due to access to financial instruments (services) and can, therefore, smooth their consumption more effectively than financially excluded households. The comparison of the results obtained from our model with the full financial inclusion model suggests that expansionary monetary policy in full financial inclusion leads to higher output growth with lower inflation costs. Therefore, efforts to ensure full financial inclusion are recommended so that monetary policy can fully achieve its goals.

Keywords: DSGE; Financial Inclusion; Financially Excluded; Financially Included; Monetary Policy. (search for similar items in EconPapers)
JEL-codes: E44 E50 E52 (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations:

Downloads: (external link)
http://jpbud.ir/article-1-2085-en.pdf (application/pdf)
http://jpbud.ir/article-1-2085-en.html (text/html)
http://jpbud.ir/article-1-2085-fa.html (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:auv:jipbud:v:27:y:2022:i:2:p:51-88

Access Statistics for this article

More articles in The Journal of Planning and Budgeting (٠صلنامه برنامه ریزی و بودجه) from Institute for Management and Planning studies Contact information at EDIRC.
Bibliographic data for series maintained by Nahid Jebeli ( this e-mail address is bad, please contact ).