The Causes and Consequences of Currency Crises in Iran

The Causes and Consequences of Currency Crises in Iran

Professor Hadi Salehi Esfahani
The University of Illinois at Urbana-Champaign

The Iranian economy is again experiencing currency and economic crises, just six years after it endured a similar turbulence and paid a heavy price to return to stability. While international sanctions have been important in triggering these episodes, domestic policies and socio-economic structures seem to have played key roles in the depth and dynamics of the crises. In this presentation, we first examine the roles played by such factors in economic instability and decline. We also compare the situation in Iran with the recent developments in some other countries, particularly Pakistan and Turkey. Then, we discuss the potential scenarios that may unfold under the current conditions. We end by exploring the policy and structural changes needed to manage the present crisis and to prevent future ones.

Hadi Salehi Esfahani is a Professor at the Departments of Economics and Business Administration and serves as the Director of the Center for South Asian and Middle Eastern Studies at the University of Illinois. He is the Editor-in-the Editor-in-Chief of the Quarterly Review of Economics and Finance, and a Board member of the Economic Research Forum and of the International Iranian Economic Association. He has also served as the President of Middle East Economic Association. He holds a B.Sc. in engineering from the University of Tehran and a Ph.D. in economics from the University of California at Berkeley. His research focuses on the role of politics and governance in economic policy formation in fiscal, labor, and trade areas, especially in the Middle East and North Africa.