The effect of long and short time oil shocks on economic growth in Iran

Authors: 
Sayyed, Abdolmajid Jalaee
Sanaz, Mohammadi
Publication date: 
2012/12/01
JEL codes: 
E32 - Business Fluctuations; Cycles, O47 - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence, Q33 - Resource Booms.
Abstract: 
Oil is one of the strategic good so that price fluctuations and shocks of it have major effects on economic growth and recession in depended countries to revenues of it. In this study, it is tried that the effect of oil price shocks investigated in two types(short and long time) on Economic growth in Iran. Its Period is from 1974 to 2006. According it, oil price uncertainty is quantized by GARCH model and is determined the effects of oil price shocks on economic growth in Iran during a short and extended time by Vector Auto-regression Estimates (VAR), Vector Error Correction Estimates (VECM), Unrestricted Co-integration Rank Test (Trace) tests. The results of these estimations have shown that the effect of oil price shocks in short and prolonged course on economic growth in Iran had been negative.
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