Analyzing the Impact of Islamic Financing Instruments on Monetary and Fiscal Policies in Iran Based on Taylor Rule: Quantile Approach

One of the innovations of the last decade in the field of Islamic monetary discussions is the publication of various Islamic securities.The release of different types of Islamic financing tools as an alternative to conventional bonds is considered one of the most important achievements of Islamic finance,which has found a special place in Islamic and non-Islamic countries,which are designed based on Islamic contracts and are a suitable alternative to bonds. Interest-bearing securities are especially bonds.The aim of the present study is to analyze the impact of Islamic financing tools on monetary policies in Iran with Taylor rule approach in the period of 1984-2020using quantile regression method.The results show that Islamic financing tools have a negative effect on the growth rate of the monetary base.In other words,with the increase in the use of Islamic financing tools,the monetary base growth rate has decreased,which shows that the behavior of monetary policy makers towards Islamic financing tools has been based on rules.