The dynamic relationship of interest rate, price level, money supply and real gross domestic product: case study of Iran
The main purpose of the present study is to investigate the relationship between macroeconomic variables such as interest rate, price level, money supply and real gross domestic product for Iran by considering the effect of economic sanctions during a time period 1980-2014. To analyze the collected data, the VARX method was used and the data were analyzed by Eviews 9 software. Also, for data analysis, the variable of economic sanction was considered as exogenous variable and other variables were considered as endogenous variables. The empirical findings of the study show that there is a significant and bilateral relationship between most endogenous variables of the model. Also, it was observed that the variable of economic sanction has a significant effect on the intended macro variables.
Keywords: interest rate, price level, money supply, real gross domestic product, economic sanction.
JEL Classification: E40, E51, F51.
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