The Impact of Inflationary Environment on Exchange Rate Pass-Through to the import Price Index in Iran

Hossein Asgharpur (), Alireza Kazerooni () and Nina Mirani ()
Additional contact information
Alireza Kazerooni: Professor of Economics, University of Tabriz
Nina Mirani: Ph.D. Student in Economics, University of Tabriz

Quarterly Journal of Applied Theories of Economics, 2015, vol. 2, issue 2, 155-178

Abstract: Exchange rate as one of the key variables of the economy plays an important role in determining the import price index. Therefore, knowledge of the empirical relationship between exchange rate and import price index, which is known in economic literature as Exchange Rate Pass-Through is important and can help economic officials on how choose their economic policies. Empirical studies conducted during the past decade show that the Exchange Rate Pass-Through on the import price index is affected by many factors such as inflation. According to the fact that during the last three decades, Iran's economy has experienced relatively high and persistent rate of inflation, in this study by using time series data over the period of 1971- 2012, examined the role of inflation in exchange rate pass-through to the import price index. Results indicate an incomplete pass-through of exchange rates to the import price index. The results also indicate that the exchange rate pass- through to import price index increases in high and intermediate levels of inflation, however, the pass-through in the high inflation level is lower than intermediate inflation.

Keywords: Exchange Rate Pass-Through; Import Price Index; Inflationary Environment. (search for similar items in EconPapers)
JEL-codes: E31 F30 F41 (search for similar items in EconPapers)
Date: 2015
References: Add references at CitEc
Citations:

Downloads: (external link)
http://ecoj.tabrizu.ac.ir/jufile?c2hvd1BERj00MzQzJ ... ZWE5MzE0ZTFjNWY2MTM3 Full text (application/pdf)

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:ris:qjatoe:0016

Access Statistics for this article

Quarterly Journal of Applied Theories of Economics is currently edited by Sakineh Sojoodi

More articles in Quarterly Journal of Applied Theories of Economics from Faculty of Economics, Management and Business, University of Tabriz Contact information at EDIRC.
Bibliographic data for series maintained by Sakineh Sojoodi ().