Designing a dynamic stochastic general equilibrium model in order to investigate the effect of monetary policy on macroeconomic variables from the bank lending channel

In order to make decisions about monetary policies, monetary policy makers must have an accurate assessment of the duration and extent of the policy's effect on the economy. This accurate evaluation of policies requires an understanding of the mechanisms according to which monetary policy affects the real sectors of the economy. Based on the studies, there is an agreement that money is neutral in the long term and has no effect on the real sector of the economy, but there is no consensus on the effect of monetary policy on real variables in the short term. Therefore, the short-term relationship between nominal and real variables is very important for the implementation of monetary policy and needs further investigation. The purpose of this study is to investigate the impact of monetary policy through the bank lending channel on macro variables in the Iranian economy. In order to analyze the results, the dynamic stochastic general equilibrium method was used in terms of the structure of the banking system in the period of 1989-2022 based on the frequency of seasonal data. In the statistical analysis section, the impact of the monetary policy index on banking and macroeconomic variables was compared and evaluated. Based on the obtained results, it can be stated that most macroeconomic variables have shown the most positive reaction to the shock caused by bank loans as a channel for influencing monetary policy.