Hosein Mohammadi; Sayed Hosein Saghaian; Amirhosein Tohidi
Volume 20, Issue 65 , February 2016, , Pages 159-184
Abstract
Exchange rate pass-through is one of the most important issues in the international economic studies. Determining the degree of exchange rate pass-through can be used to define the effectiveness of foreign policy, market structure and exporters behavior. The main objective of this study is to investigate ...
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Exchange rate pass-through is one of the most important issues in the international economic studies. Determining the degree of exchange rate pass-through can be used to define the effectiveness of foreign policy, market structure and exporters behavior. The main objective of this study is to investigate the exchange rate pass-through to export prices of Iranian pistachios during the period 1961-2011. In the previous studies, the exchange rate pass-through was assumed to be fixed during different years. This assumption is not consistent with reality, because many factors can influence the exchange rate pass-through. In this study, sensitivity analysis in the framework of artificial neural network is used to address this shortcoming. The results shows that exchange rate pass-through to Iran's pistachio export prices has been more than 70 percent, and its trend has been periodic. Furthermore, the results showed that there is a direct relationship between exchange rate fluctuations and Iranian pistachio export prices. Thus, by reducing exchange rate volatility, it is possible to supply pistachio with lower prices to the world markets. Considering the high elasticity of demand for the Iranian pistachio prices, a reduction in prices would increase revenues of exporters. Incidentally, given the high elasticity of export demand for Iran's pistachio, the revenues from the export of this product can be increased by reducing the cost of pistachio production.
Javid Bahrami; Teimour Mohammadi; Shadi Bozorg
Volume 19, Issue 60 , October 2014, , Pages 37-65
Abstract
Tracing the impact of exchange rate movements on prices is one the most important issues in monetary policy making. In this paper by applying a SVAR model to a quarterly data set spanning from 1990q1 to 2013q4, we assess the effect of exchange rate variations on domestic prices in Iran. In addition to ...
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Tracing the impact of exchange rate movements on prices is one the most important issues in monetary policy making. In this paper by applying a SVAR model to a quarterly data set spanning from 1990q1 to 2013q4, we assess the effect of exchange rate variations on domestic prices in Iran. In addition to exchange rate growth and output gap, the growth of liquidity, consumer, producer, and import prices are also included in the model. Our findings suggest that: i) There is an asymmetry in exchange rate pass-through in Iran. ii) Although small appreciations have no effect on prices, depreciations, especially large ones, are significantly effective. iii) The effect of exchange rate on consumer price growth, lasts for relatively longer periods of time.
