Optimizing Banking Network Resilience to Exchange Rate Shocks
نویسندگان
1 Department of Economics, Qazvin Branch, Islamic Azad University, Qazvin, Iran.
2 Department of Economics, Qazvin Branch, Islamic Azad University, Qazvin, Iran.
3 Department of Economics, Qazvin Branch, Islamic Azad University, Qazvin, Iran.
4 Department of Economics, Qazvin Branch, Islamic Azad University, Qazvin, Iran.
doi
10.30473/coam.2024.72329.1262چکیده
This paper explores the resilience optimization of Iran's banking sector in the face of exchange rate shocks---critical macroeconomic disturbances with extensive consequences. We develop a multi-sector macro-dynamic stochastic general equilibrium model encompassing essential economic components, including firms, government, central bank, and the banking sector. This framework facilitates the simulation of the macroeconomic environment and allows for a thorough analysis of the banking sector's adaptive responses to exchange rate fluctuations. Our findings reveal optimization strategies that effectively mitigate the adverse effects of these shocks while maintaining equilibrium in the broader economy. Specifically, we discover that while an initial positive exchange rate shock can enhance banking sector performance, it ultimately triggers inflationary pressures that threaten profitability and operational stability in the medium to long term.
