Estimating the demand function for gold in Iran from ۱۹۹۵ to ۲۰۱۶ (A State-Space model)

The main purpose of this study is to estimate the demand function and price elasticity of demand for gold in Iran from ۱۹۹۵ to ۲۰۱۶. In this paper, the demand for gold has been estimated by the state-space model and the Kalman filter technique in a time-varying pattern. Based on the results, it can be concluded that one-percent increase in the real price of gold demandresults in۱.۱۷ percent decreas in in gold demand. The elasticity of gold demand and GDP is not statistically significant morever the elasticity of gold demand and population variable indicates that one percent increase in the population of Iran, leads to ۰.۰۳ percent increase as well .The price elasticity of demand for gold in Iran from ۱۹۹۰ to ۲۰۱۶ has almost risen, indicating an increase in the sensitivity of gold consumers in the face of gold price changes.

Keywords:

Gold Demand , Price Elasticity of Demand , Population , State-Space model , Kalman filter Technique.