Investigating the Effects Currency Issuance by the Central Bank on the Macro Economy of Iran

Afshar, Hamid Reza; Aghaee Meybodi, Amir Hossein

Investigating the Effects Currency Issuance by the Central Bank on the Macro Economy of Iran

Document Type : Original Article

Authors

¹ Ph.D. Candidate, Department of Strategic Management of cyber space, Faculty of Strategic Management, Supreme National Defense University, Tehran, Iran.

² M.A., Department of Business Management, Faculty of Economic and Administrative Sciences, Ferdowsi University of Mashhad, Razavi Khorasan, Iran.

Abstract

In recent years, the advent and development of new forms of e-currencies has threatened national currencies issued by central banks (which perform various functions on terms of exchanges and monetary policy). In view of the foregoing, Central Banks are trying to develop cryptocurrencies that perform both the functions of decentralized digital currencies whilst preserving the sovereignty of the national currencies. Various Cases of this effort are currently being trialed or studied on an experimental basis in many countries. This study investigates the effects wrought by the issuance of digital currencies by the Central Bank on the macro economy of Iran. For this purpose, the methodology of this paper relies on the analysis of data from interviews and questionnaires.
The results obtained indicate that the issuance of digital currencies by central banks can be effective in improving the nominal-monetary variables of the economy. Furthermore, among the other positive effects of the issuance of digital currencies include; enhancing the efficiency of monetary policy tools; increasing the efficacy of monetary policy platforms such as the interbank lending markets; improving monetary transfer mechanisms such as the payment system, improving the efficiency of financing and investment.

Keywords