The Effects of Real Exchange Rate Uncertainty on Economic Growth in Iran



This paper evaluates the real exchange rate fluctuations and uncertainties resulting from it, in the Iranian economy. For this purpose, at first indirect effect of real exchange rate uncertainties on economic growth through foreign investment, private investment and exports are expressed, then the real exchange rate uncertainties and its relationship with economic growth and final pattern of investment growth has been determined. In this study, the economic growth model, private investment model, the model of foreign investment and export model has been studied. The simultaneous equations system functions method for 1387-1354 periods is estimated. Results of estimating model, indicating a significant and negative effect of real exchange rate uncertainties on the economic growth.
JEL Classifications: D81, C51, F31, O40