تعیین سناریوی بهینه کاهش اثرات ناشی از شوک حذف ارز ترجیحی بر گروه‌های عمده غذایی؛ رهیافت مدل تعادل عمومی قابل محاسبه پویای بازگشتی (RDCGE)

Introduction

The currency jump at the early of 2018 and the increase in prices during the following years caused the Iranian government to adopt a policy of preferential currency allocation (42000 Rials per US$) for the import of basic goods from August 2018. The main goal of this policy was to control the fluctuations of the domestic market and decrease in the welfare of the society. But, the available evidence showed that after a few years of the implementation of this policy, due to the increase in the price of most of the targeted basic goods and the lack of profit of the lower income deciles in an optimal way and emergence of problems such as: spread of rent and corruption and diversion of allocated resources in the form of official re-export of inputs or final goods or smuggling, hoarding, overselling to the final consumer, etc., the policy of assigning preferential currency to essential goods was not successful. Following to the ineffectiveness of the policy of allocating preferential currency to basic goods, the Iranian government in May 2022 implemented the policy of removing preferential currency from basic goods. The evidence shows that although the mentioned policy has increased the price of major food groups (chicken meat, eggs, milk, red meat and edible oil), it has led to a continuous decrease in inflation of major food groups. However, the basic question is that if the aforementioned policy was implemented gradually, wouldn't it have better results? Also, what type of support compensation for households (cash or goods) and what level of support coverage for income deciles would lead to better results? Therefore, the present study was conducted with the aim of determining the optimal scenario of reducing the effects of the shock of removing the preferred currency on major food groups.

Methodology

In order to determine the optimal scenario of reducing the effects of the shock of removing the preferred currency on major food groups (chicken meat, eggs, milk, red meat and edible oil) 18 scenarios designed in the form of the type of removal of preferred currency from basic goods (at once, during 3-years and during 5-years period), the type of support compensation (cash or goods) and the level of coverage of income deciles (all income deciles, low and middle income deciles and only low income deciles) were discussed. For this purpose, the required data were collected from the social accounting matrix of the Islamic Parliament Research Center, Central Bank's input-output table, and Iran's Statistics Center. In addition, in order to analyze the data, the recursive dynamic calculable general equilibrium (RDCGE) model (which is based on the assumption of adaptive expectations) and Matlab software were used.

Discussion and Results

According to the results, the best scenario for reduct the negative effects of preferred currency removing shocks on major food groups is the scenario of removing the preferred currency from basic goods during a 5-years period, providing support in cash and providing support to the low and middle deciles of income, which has a positive effect on production, consumption, income of the factors of production (labor and capital), welfare of consumers, welfare of producers, and total welfare. In the sense that if the government gradually removes the preferential currency for basic goods over a 5 years period and supports the low and middle income deciles in cash, the negative effects caused by the shock of implementing preferred currency from basic goods in the society is neutralized and then becomes positive.

Conclusion

Based on the results of the research (the best scenario is the scenario of eliminating the preferred currency during the 5-years period, cash compensation and the level of coverage of the low and middle income deciles), it is suggested to the government officials that make the implementation of the policy of removing preferred currency from basic goods, as close as possible to the proposed scenario and to support the consumers of basic goods in cash. Because although in the method of compensation in the form of goods, it can be ensured to some extent that some of the resources planned for this project will be spent on buying basic goods and will provide the minimum calories needed by the household, but the mentioned method leads to the increase in demand for basic goods, disruption of relative prices, will create a black market for commodity coupons. On the other hand, if the electronic coupons granted can only be cashed in certain distribution centers, it will create a kind of rent for selected distribution centers compared to micro distribution centers. But in the cash method, the right of choice of the households is recognized from the beginning and since the households can receive the subsidy payment in cash or purchase basic goods, it leads to the freedom of choice for them. As a result, the purchasing power of consumers' increases, which will subsequently lead to an increase in the production of goods, including food. In addition, some believe that the cash support compensation will lead to an increase in inflation. However, if its resources are precisely determined and secured and the Central Bank's resources are not used for this purpose, it will not cause inflation. On the other hand, the way of cash support compensation should not be in a way that creates the impression of being permanent and long-term. Rather, it should be stated from the beginning that this subsidy is only to pass the transition and temporarily compensate the households.