In recent years, the causes of double-digit inflation in the economy of Iran have been the biggest challenge for Iranian researchers. However, time inconsistency has been paid less attention while according to Kydland and Prescott (1977), time inconsistency of monetary policy can be the most important cause of inflation bias. A policy is time inconsistent or dynamic inconsistent when it is considered as the best policy for particular time in the future, but it does not remain so, when that particular time actually arrives. There are two possible mechanisms that have been considered for such a time inconsistency. (i) Strotz (1955-1956) explain that time inconsistency is because of changing preferences, (ii) Kydland and Prescott (1977) consider another explanation that is based on agent’s rational expectation. The main idea is, when people expect low inflation, central bank thinks of high inflation. If people understand it, they predict higher inflation. In this situation, predicted inflation is optimal inflation. In other word, while inflation policy is optimal at first, high inflation policy will be optimal in the end. We use the second mechanism in this paper. Barro and Gordon (1983) have explained time inconsistency of monetary policy as follow: in a discretionary regime, central banker can print more money and make more inflation than people’s expectation. Benefits of this surprising inflation might provide more economic activities or reduce government’s debt. However, if people, due to their rational expectation, understand it and adjust their expectations with it, then policy maker will not reach his target at all. Besides that, due to increased money supply, the level of prices will grow. So the question that arises here is how much of the inflation is due to discretionary behaviors in applying monetary and fiscal policies? In other words, what is the inflationary bias caused by the Time Inconsistency of monetary and financial policies. In the present study, the framework of Barro-Gordon has been applied to calculate the inflation bias of time inconsistency of monetary and fiscal policies. In fact, we have extended Walsh (2010) ’smodel by adding fiscal variable. These models consist of two main sections: loss function and the supply curve. According to the structure of the economy of the developing countries, the fiscal and monetary policies are dependent and are determined by a third person (the president). Thus, a general loss function which consists of fiscal and monetary variables is used. In fact, the lack of independence of the central bank is considered in this model. What distinguishes this study from other studies, include: Calculating the inflation bias using a model that considers the time inconsistency of monetary and fiscal policies simultaneously. Unlike Surico (2008), we used symmetric loss function. Calculating inflation bias in Each Economic Development plan of Iran The model solution will be done by two approaches of discretion and commitment. After applying the optimization, inflation bias will be the difference of results of these two approaches. Moreover, the inflationary bias of the model is calculated based on Iran’s economy data over the period of 1991-2016. This bias is then calculated for each of the country' s five-year economic development plan. The results show high inflation bias in Iran (9.8%). Furthermore, based on the results, the first and the third economic development plans have the lowest and the highest inflation bias, respectively. Besides that, it can be seen, predicted inflation in third and second part of fifth economic development plans, have significant difference with performance inflation. In other words, the present model has failed to provide an adequate estimate of the inflation of these two periods. It seems that the reason is considering high target inflation in two plans.

In this work, we study the anisotropic inflationary models. In these models, an abelian gauge field non-minimally coupled to the inflaton field plays a role in the inflation dynamicIn a gauge field, the backgroundanswer is anisotropic, in the form of metric Bianchi. In order for the model to be consistent with the observations, the level of anisotropy should be small. The anisotropy power spectrum is obtained by calculating cosmological perturbation using  N formalism. We show that the criticism levelled in [4] does not apply and we can repeat the calculations in the nonabsorbence by calculating the anisotropy spectrum. Using the constraint on the quadrupole anisotopy, we show that the contribution of the gauge field to total energy density should be very small

Enhancing the independence of the monetary authorities to mitigate inflationary bias is seen as a crucial political decision. Many countries, by adopting this approach, have assured their economies that controlling inflation and achieving macroeconomic stability are binding constraints for political authorities. Some countries enshrine such independence in their constitution, others through legislation related to the central bank, while some adhere to it in practice without any legal mandate. With the introduction of the new Central Bank Act, questions arise about whether this principle has been upheld. This study employs prominent independence measurement indicators, namely the Cukierman Index and the Grilli Index, to assess the Central Bank's independence under both the Monetary and Banking Act and the new Central Bank Act, as well as to compare it with other countries’ central banks’ independence. The results indicate that, compared to the Monetary and Banking Act, the new Central Bank Act has increased the Central Bank's independence by 16.6% based on the Grilli Index and by approximately 7% based on the Cukierman Index. However, despite these improvements, the legal independence of the Central Bank under the new act remains within the lowest 25% globally.

Nowadays exchange rate management and eliminating its deviation is one of the main challenges of policy makers in countries such as Iran. Because any abnormal fluctuation and deviation of exchange rate can affect other economic sectors negatively. This article tried to evaluate exchange rate misalignment in Iran in context of inflation regimes in favor of reality of results. To do that by applying Markov Switching technique inflationary regimes which have taken place in Iran’ s economy over period of 1990-2017 were extracted and consequently by applying a monetary exchange rate determination approach nominal exchange rate misalignment has been calculated. The results imply that in high inflationary regime the absolute value of misalignment is much greater than low inflationary regime. Meanwhile when in low inflationary regime a positive inflation shock on nominal exchange rate has an increasing but degenerating impact, but in high inflationary regime it leads to a persistent great increase in nominal exchange rate that continues for ever. These findings could have useful policy implications for authorities.