Investigating the Effects of Regulation of Iran Mercantile Exchange on Goods Price Growth

One of the important socioeconomic tasks of governments is regulation. Regulation literature focuses on government intervention in the market for regulating the amount of production and distribution of a commodity, which can lead to the determination of the structure and rules governing the market. A commodities exchange is one of the most important regulatory agencies, which, by providing a convenient, transparent and observable trading system, is customary for the flow of government-specific regulations on commodities. The aim of the present study is to test the regulatory results of supply of products in the commodities exchange. To this end, the percentage increase in the price of 12 commodities traded on the commodities exchange was compared with 21 off-exchange trades using the Propensity Score Matching technique, Caliper and Radius Matching technique, and Bootstrap Standard Deviation. According to the obtained results, the supply of commodities on the Iran mercantile exchange has led to a decrease in their price growth compared to similar commodities outside the Iran mercantile exchange. As a result, using regulatory agencies such as the commodities exchange will increase production and welfare of the society.