Analyzing the effects of conventional and non-conventional monetary policies on economic growth in uncertain conditions using stochastic general equilibrium (DSGE) method.

The relationship between financial and monetary policies and economic growth is a well-known topic in economic literature. Conventional policies refer to the set of policies implemented by the World Bank and the International Monetary Fund as custodians of the neoclassical growth model. However, in exceptional circumstances where conventional monetary policy tools prove insufficient to achieve the central bank's goals, unconventional monetary policy measures can be employed. This study aims to explore the use of both conventional and unconventional monetary rules for monetary policy. Unconventional monetary policy tools offer an alternative to conventional interest rate policy, serving to stabilize the economy and separate monetary policy from political pressure. The utilization of unconventional monetary policy represents an innovative avenue for enhancing economic forecasting. In this investigation, seasonal data from 1978 to 2021 were utilized, and Bayesian estimation of model parameters was conducted using the Dynare add-on package within the MATLAB software environment. The study examines the relationship between conventional and unconventional monetary policies and economic growth. The results indicated that the analyzed model successfully captures the dynamic relationships among various series uncertainties and variables, including letters of credit, bonds, legal reserve, public sector deposits, quantitative easing, taxes, and loans. Both conventional and unconventional monetary policies play significant and impactful roles in influencing economic growth. Additionally, the variables related to government and non-government sector debt have a negative and significant effect on economic growth. Consequently, the use of unconventional monetary policy tools yields a positive impact on economic growth, with easing policies being particularly effective.