uncertainty inflation and economic growth

Subject Areas : Financial Economics

Gholamreza Abasi ¹ , Ashcan Rahimzadeh ² , Davood Salmani ³

1 - Assistant Professor of Ecinimics,Islamic Azad University, Central Tehran Branch
2 - Assistant Professor of Ecinimics,Islamic Azad University of zanjan
3 - M.A Student

Received: 2015-06-10 Accepted : 2015-06-10 Published : 2009-12-22

Keywords: Economic Growth, Uncertainty Inflation, money Growth rate, Fuzzy Theory,

Abstract :

Inflation or in other words the increase of public price’s level is one of the important and effective variable in each country’s economy that in different courses especially in high prices had imposed unfavorable and detrimental effects on countries’s economy. But the major and the most important detriment due to inflation is the distrust of scale of inflation’s rate in future. Except the economic factors such as inflation and production and ect, political factors can put economic factors in unreliable conditions. For example, political instability, war, people’s distrust in case of economic decisions and totally each decision or policy that causes distrust in economy atmosphere is effective in inflation uncertainty. In this article, we calculate the scale of uncertainty inflation during 3185-3156 with use of collection of “Fuzzy logic” and the two input variables, “inflation” and “money growth rate” used with base year’s prices. At the following section, Robert and Alexander’s economic growth model has been utilized to investigate the efficacy of the inflation uncertainty on the economic growth for the time being. (In this model inflation uncertainty variable has been used instead of inflation variable). The results of the present study using OLS method for calculating the mentioned patterns shows that inflation uncertainty hasn’t meaningful affected on the economic growth. The positive effect of investment share, export share in GDP on the economic growth and share of public section expenses were other results of the present study. The important point that should be noted here is that measuring and specifying the exact amount of inflation uncertainty and surveying relationships between them and its efficacy on other variables can be an appropriate way in making correct decisions