The effects of oil revenue and monetary policy shocks on non-oil output is studied by modelling Long-run output function (using a stochastic differential equation approach) and estimating a partial VAR model (1988:2-2008:3). The results show that a positive oil revenue shock has a negative effect on non-oil GDP in the first period، but increases it in the following periods. Also، the results show that a monetary shock has a small role in explaining output variations. The results are controvetial and need further research.

JEL Classification: C32, F43, Q32