Historical Implications of Path Dependence In The Institutional Arrangements of Iran’s Monetary Policy

Document Type : Research Article

Authors

1 Ph.D Student of Economic, Faculty of Economics, Allameh Tabataba’i University, Tehran, Iran

2 Professor of Economic, Faculty of Economics, Allameh Tabataba’i University, Tehran, Iran

10.22059/jppolicy.2025.102506

Abstract

This article analyzes the recurrence of similar issues in Iran’s monetary and banking policy-making since the establishment of the Central Bank. Utilizing the theory of Institutionalism and the concept of Path Dependency, the research assesses the persistence of problems such as inflation, budget deficit, and fiscal indiscipline in Iran from the 1960s to the conclusion of the 11th government of the Islamic Republic. The objective of this study is to demonstrate how Iran's institutional framework has contributed to the perpetuation of these challenges in the realm of monetary policy formulation. The findings of this study are derived from a content analysis of the memoirs and interviews of economic agents. The central hypothesis of This article posits that the generation of unproductive rents through inefficient institutions serves as the primary catalyst for path dependence in Iran's political economy. This research delves into the manner in which this dependence influences the recurrence of economic crises and the process of policy-making in Iran.

Keywords

References

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Iranian Journal of Public Policy
Volume 11, Issue 2
June 2025
Pages 49-65

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