Estimating Optimal Inflation Rate in Saudi Arabia: Using Dynamic Threshold Regression Model

Influence on Saudi Arabia

"Broadcast" theory is one of the common theories explaining how phenomena and ideas spread. It is used by researchers in different fields of study. Having studied broadcast theory and its different components, this article tries to represent whether Islamic revolution of Iran has exerted influence on Saudi Arabia. And if positive, how it has influenced and how much it has been. The results sug...

The Impact of Exchange Rate Pass-Through via Domestic Prices on Inflation in Iran: New Evidence from a Threshold Regression

There are various causes for inflation in macroeconomics. One of the important channels of experiencing inflation is through the international economy caused by external shocks. In this context, the impact of exchange rate volatilities on domestic prices known as Exchange Rate Pass-Through (ERPT) plays a vital role. The present paper deals with the impact of Exchange Rate Pass-Through on inflat...

Estimating Rate Equations Using Nonparametric Regression Methods

On the Optimal Inflation Rate

How do financial frictions affect the optimal inflation rate? Can financial frictions alone annul the long-run super-neutrality of money? Should the inflation rate be higher in emerging market economies with less developed financial markets than in advanced economies, as is currently observed? To answer these questions we set up an incomplete markets model in which households choose portfolios ...

The Optimal Rate Of Inflation∗

Observed inflation targets around the industrial world are concentrated at two percent per year. This chapter investigates the extent to which the observed magnitudes of inflation targets are consistent with the optimal rate of inflation predicted by leading theories of monetary nonneutrality. We find that consistently those theories imply that the optimal rate of inflation ranges from minus th...