Document Type : Research Paper
Abstract
Abstract
In economics of Iran, bank interest rate is determined by imperative form and by considering high inflation rates in Iran, it is per formed negative real interest rate and financial repression. In this research, by Mackinnon and Shaw’s view, it has been investigated the effect of bank loans interest rate in the investment and production in economics of Iran. In order to, the first it was designed an DSGE model for economics of Iran. This model includes four parts household, firm, trading banks, government and central bank. The results indicated that based on bank credits interest rate increased but is reduced investment, bank credits and GDP. Thus the increase of bank loans interest rate is caused to reduce the economic growth. Therefore, Mackinnon and Shaw ۥtheory is rejected in economics of Iran.
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