Volume 6, Issue 22 (12-2015)                   jemr 2015, 6(22): 93-131 | Back to browse issues page


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The Effects of Monetary and Fiscal Policy Shocks on Stock Market of Iran. jemr 2015; 6 (22) :93-131
URL: http://jemr.khu.ac.ir/article-1-1086-en.html
Abstract:   (7316 Views)

In recent decades the development of capital markets in developing countries, economic growth is desirable to have. Developed countries owe much of its development direction of financial markets, especially the stock market knows. The stock market is precisely the collection of savings and private capital to finance investment projects and on the other hand, an official and is confident that the owners of dormant savings can be relatively affordable and safe place to seek investment and their funds to invest in companies operate. The role of the stock market to boost the economy of countries like Iran and wandered from one side to the large amounts of capita and on the other hand, face a shortage of investment, is striking. Therefore, understanding the factors influencing the behavior of the stock market can be considered useful for the capital's economy. In this context, this study examines the impact of fiscal and monetary policy shocks on stock market Iran. Regression model to estimate the structural model and the data for seasonal 1991: 1-2010: 4 was used. The results of the model indicate that the short-term shock to the money supply (monetary policy instrument) and long-term government spending shocks (monetary policy instrument) Fluctuations of stock price indices explain. In other words, the impact of monetary policy on stock prices faster than the impact of fiscal policy. Because government spending through the stock market affects ,First government spending on aggregate demand and thus income consumers and the general level of prices affects subsequent stock price changes, but by changing the money supply, the faster people can spend their surplus cash available to purchase the stock of assets that form part of it. The lag effect of monetary policy is much shorter than the lag effect of monetary policy

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Type of Study: بنیادی | Subject: پولی و مالی
Received: 2014/08/16 | Accepted: 2014/11/26 | Published: 2016/03/2

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