Shiraz University Iranian Journal of Economic Studies 2322-1402 4 1 2015 05 05 The Effect of Real Exchange Rate Volatility on Strategic Investment in Iran تأثیر نوسانات نرخ ارز واقعی بر سرمایه‌گذاری استراتژیک در ایرانCGE 81 100 3776 10.22099/ijes.2015.3776 EN Hamid Reza Horry Department of Economics Shahid Bahonar University, Kerman Elham Rahimi Department of Economics Shahid Bahonar University, Kerman Journal Article 2013 10 26 This study examines the impacts of real exchange rate fluctuations on the companies' strategic investments in Iran. The data of 92 listed companies in Tehran Stock Exchange during the period of 2002-2015areused. First, the volatility of exchange rate is estimated by the Generalized Autoregressive Conditional Heteroskedasticity (GARCH). The model is estimated by GMM and system GMM methods. The results show that the relationship between exchange rate volatility and companies' strategic investments has an inverse U-shaped. The estimation result of GMM method shows that the inflection points for volatility of exchange rate and its lag are 0.08% and 0.13% respectively. When we estimate the model with system GMM the inflection point for exchange rate volatility and its lag are 0.05% and 0.11%, respectively. Moreover, we find out that the first lag of investment and cash flow variables have had positive and significant effects on strategic investment. https://ijes.shirazu.ac.ir/article_3776_464ee655c056c946d214c674b30c27e5.pdf