hamid sepehrdoust; Seyed Ehsan Hosseinidoust; Maryam Bayatani; Marziyeh Rasuli
Abstract
Extended abstract
1- INTRODUCTION
The World Bank defines poverty as deprivation of the level of welfare and well-being. Inequality is defined as the difference between individuals in society in accessing economic resources that can appear in the distribution of income, wealth, consumption, ...
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Extended abstract
1- INTRODUCTION
The World Bank defines poverty as deprivation of the level of welfare and well-being. Inequality is defined as the difference between individuals in society in accessing economic resources that can appear in the distribution of income, wealth, consumption, wages, and savings of society. Equal distribution of income is always one of the most important issues in the economies of different countries and if we express the concept of poverty, and insufficient income, the challenge of more equitable distribution of income and wealth would be more important economic issues and is an important indicator of economic development which is considered by economic policymakers. At present, the existence of poverty and its severity in society is a sign of unhealthiness, poor economic system performance and failure of social justice programs and it is necessary to improve the situation of low-income people and below the poverty line appropriate monetary and fiscal policies affecting the improvement of the income distribution.
2- THEORETICAL FRAMEWORK
Poverty and income inequality the issue of poverty and poverty alleviation due to income inequality has always been the focus of economic planners and this feature of developing countries is one of the problems of human society that has not only not been controlled, but continuously despite the progress made in various economic fields intensified. Given the need to deal with the poverty crisis, this phenomenon should be studied and evaluated from both theoretical and practical aspects. Theoretically, poverty and its components should be carefully defined and identified, and from a practical point of view, the level of poverty in the country or society should be measured. The unbalanced distribution of income in society is one of the problems that in the short term, although it may not be reflected in the daily problems of the country, its continuation in the long run, in addition to creating widespread poverty, can create political tensions and lead to crises. Income redistribution can be achieved through tax policies, government transfer payments, and social spending.
3- METHODOLOGY
To examine and analyze the research hypotheses on the effect of tax structure on income inequality in a selection of the Middle East and North Africa (MENA) member countries including Iran, Egypt, Jordan, Turkey, Tunisia, Morocco, Cyprus, Rwanda, Zambia, Palestine. They are occupied and the data panel model for the years 2005-2018is used. The source of international data collection is the World Bank website and the International Indicators System. In this study, the Gini coefficient variable is used as an indicator of the income distribution, and the dependent variable is studied as an indicator of economic development in selected countries. Factors in the form of independent variables include the tax structure and other variables include economic factors such as inflation and per capita income. In this study, Gini coefficient variables have been used as an influential variable for the income inequality index. Following the existing theoretical foundations on the effect of tax structure on income inequality, the model of this research is specified as:
Gini = α +β1 INCT +β2 GT +β3 GDPP +β4 EDU +β5 UNEP +β6 INF +Uit
Where the introduced variables of the research model are:
Gini: Gini coefficient
INCT: Income tax
GT: Tax on goods and services (consumption tax)
GDPP: Gross Domestic Product Per Capita
EDU: Number of people registered in the second stage of education
UNEP: Unemployment rate
INF: Inflation index rate
4- RESULTS & DISCUSSION
According to the research results, the effect of tax structure on income distribution, which in this study is examined by separating two types of taxes, one is goods and services tax and the other is the income tax. The results showed that rising inflation reduces income inequality. Although this result contradicts the common view of the relationship between inflation and income distribution, it can reinforce the part of economic theories that the existence of inflation in proportion to economic growth increases per capita income, which leads to improved distribution. Regarding the education variable, the results indicate that income inequality will decrease as government spending increases. Because labor wages are determined by their relative productivity, education can increase labor productivity by increasing literacy and knowledge levels and thus increase their wages, thereby helping to reduce inequality.
5- CONCLUSIONS & SUGGESTIONS
According to the results, growth strategies must be considered along with income distribution. Establishing a strong tax system to prevent tax evasion as well as prevent illegal activities leads to the optimal size of government and the economy. If government interventions, if they are at their optimal level and social and educational programs are carried out to the extent that they improve social indicators, in addition to reducing the problems related to income inequality, reducing People's inclination and entry into the economy will have a great impact and will help to improve the situation and reduce income inequalities. In proportion to the results obtained, for taxes to play an effective role in income distribution, in addition to increasing the tax base, unnecessary tax exemptions should be avoided. For example, it is proposed to reduce the corporate tax rate and increase the wealth tax due to the transfer of the tax burden from the corporate tax.
Habib Ansari Samani; masoume Rouzbahani
Abstract
Introduction The main keys that influence crime rates are examined from two economic and sociological points of view. Preventing crime is one of the requirements of any healthy society. Economic inequalities and unfair distribution can be the main reasons of crimes. The complexity of the relationship ...
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Introduction The main keys that influence crime rates are examined from two economic and sociological points of view. Preventing crime is one of the requirements of any healthy society. Economic inequalities and unfair distribution can be the main reasons of crimes. The complexity of the relationship between justice and fairness on the one hand and the indicators of the distribution of economic benefits from the other hand admit the essentiality of the examining relationship between income inequality and crime rates. Recent researches have shown that income inequalities and economic discrimination are among the top priority factors that affect social crimes. This research studies the effect of various economic justice indicators on crime rates in the provinces of Iran. Theoretical frame work Studies show that the economic situation has significant effects on individual activities, including crime. In addition, the feeling of being deprived of success and exacerbating this feeling in relation to successful people (the existence of inequality) can be a source of criminal behavior (Stolzenberg et al., 2006). People who are frustrated by their failures in their community become more annoying when confronted with successful people around them. According to this theory, poor people in a situation of high inequality are more likely to commit criminal acts (Enamorado, et al., 2016). The sense of deprivation can be due to various factors such as belonging to an ethnic minority, Ethnic heterogeneity, or income inequality. Runciman& Runciman, (1966) argues in the theory of relative deprivation that income inequality has created a sense of expropriation in one person and increases injustice, thereby increasing the amount of crime committed by increasing inequality of income (Rufrancos et al., 2013). Economic and social inequalities increase the crime rate by weakening social integration and increasing the social class gap (Wilkinson & Pickett, 2010). Methodology Choe (2008) shows that the amount of crime in the past period has a great effect on the crimes of the current period. Therefore, to test the hypotheses, the GMM Arellano and Bond (1991) method is used to estimate the model. The following models are estimated for 28 provinces of Iran during the period 2000-2015. (1) (2) (3) (4) Where is the number of crimes divided by province population, represents the Gini coefficient, is discrimination indicator from a capacity viewpoint, is discrimination indicator from a need viewpoint and is the average of and . Economic discrimination index is the province's current and capital government budget divided by the capacity share (population, value-added, and area), and share of needs (unemployment rate, illiteracy rate, and life expectancy) of each province[1]. expresses the unemployment rate, is per capita GDP, is government size (division of provincial government expenditures on provincial GDP) and is the urbanization rate (urban population divided by the total population). Results and Discussion The results of the estimation of regression models are presented in Table 1. Table 1: Regression coefficients by two stage stepwise generalized moments Model/Variable 1 2 3 4 Gini coefficient 10.838*** 0.000 Capacity Discriminative Index 8.343*** 0.000 Need Discrimination Index 8.035*** 0.000 Total index of discrimination 9.702*** 0.000 Unemployment rate 0.727*** 0.581*** 0.746*** 0.552*** 0.001 0.002 0.000 0.005 GDP per capita 150.871*** 118.595*** 160.182*** 117.769*** 0.000 0.000 0.000 0.000 Government Size -0.83 -0.115*** -0.099*** -0.113*** 0.064 0.000 0.000 0.000 Urbanization rate 1.153*** 1.443*** 1.324*** 1.433*** 0.000 0.000 0.000 0.000 CRIME (t-1) 0.562*** 0.506*** 0.523*** 0.508*** 0.000 0.000 000/0 0.000 Sargan chi-2 24.408 26.929 25.391 27.310 *** is 99% significance level and the values inside The results indicated in Table 1 show that the effect of all indicators of economic inequality on crime is positive and significant. The effect of the unemployment rate and GDP per capita on crime is positive and significant in all four estimated models. The effect of government size on the crime rate is negative and significant in models 2-4. That means government spending has been increasing welfare and reducing inequality. The impact of urbanization rates on crime in all models is positive and significant. Results show that the impact of migrations to cities and the marginalization of households increase crime. The causality test also shows that all indicators of economic inequality are the statistical cause of crime, but there is no inverse relationship. Conclusions and Suggestions The results show that there is a statistically significant relationship between crime and economic inequalities. Also, causality shows that in addition to statistical relationship, causality relationship also exists. Hence, reducing income inequality and economic discrimination is needed to reduce crime. Economic discrimination of government spending can also increase the rate of crime in the provinces. Therefore, governments should realize that the discriminatory spending of governments, in needs and talents viewpoint, can in addition to slow down economic progress, lead to social harms. The results show that government size had a negative impact on the crime rate. The relationship between unemployment and crime also indicates the importance of reducing unemployment in reducing crime rates. It seems that the positive relationship between economic growth and the crime rate was due to an increase in crime benefits because of rising incomes, and because the wealthy regions are due to the opportunities available for theft (which constitute a large amount of total crime) will attract more criminals (Khan et al., 2015). Finally, increasing the urbanization rate increases the crime rate. Immigration and marginalization of cities seem to have a damaging effect on the health of the community. [1]. See Ezzati (2013) for further study on this index.
Hossein Mohammadi; Alireza Sani Heidary
Abstract
Expended Abstract:
Introduction
In the last decades, economic growth is one of the important issues among researchers because economic growth rate is one of the important factors in investigating the performance of different countries' economic policies. So, an investigation of influencing ...
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Expended Abstract:
Introduction
In the last decades, economic growth is one of the important issues among researchers because economic growth rate is one of the important factors in investigating the performance of different countries' economic policies. So, an investigation of influencing factors on economic growth is necessary. Entrepreneurship can significantly impact economic growth by creating innovation, design, diversity of product production, and increasing the efficiency and competition of firms, and also higher economic growth will also increase the incentive of innovation and knowledge for entrepreneurs. Also, countries that are on the path to economic growth lead to motivating entrepreneurs innovation and knowledge. As a result, economic growth can affect creating entrepreneurship. Therefore, economic growth and entrepreneurship are recognized as two essential components in economic. In recent economic theories, institutional factors are influential in assessing the relationship between economic growth and entrepreneurship. Therefore, this research seeks to investigate the interaction effects between entrepreneurship and economic growth, emphasizing the quality of institutional factors using the simultaneous equation model and panel data for the OECD and OPEC in the 2000-2016 periods.
Theoretical Framework
Entrepreneurship is a purposeful activity to create, maintain, and develop profitable businesses. These entrepreneurial activities can be considered three sections: 1) Total entrepreneurial activities; 2) Opportunity for entrepreneurial activities; 3) The need for entrepreneurial activities. The combination of these three components creates a new index called global entrepreneurship. From the perspective of the institutionalism approach, the environment shaping the economy affects entrepreneurship dynamics within each country. This environment is known through interdependencies between growth, economic development, and institutions. Entrepreneurs are the main perpetrators of change that react to unplanned stimuli within the institutional framework.
Methodology
The present study seeks to assess the interactions between entrepreneurship and economic growth and its relation with institutional quality using the simultaneous equation approach in panel data for two groups of OECD and OPEC countries during the period 2000-2016. The two groups of OECD and OPEC countries differ significantly in terms of economic structure. So the results may be different for them. The selection of these two groups of countries can help obtain actual results of the relationship between entrepreneurship and economic growth and the role of institutional quality on them. Many studies have shown that there are two-way feedback effects between economic growth and entrepreneurship. This feedback on both sides leads to the bias results in the traditional regression. Therefore, in such cases, the system of simultaneous equations is used. In this research, instrumental variables (IV) and generalized method of moments (GMM) methods are used to estimate the equations. The explanatory variables for the economic growth equation are entrepreneurial index, institutional quality index, life expectancy, total government expenditures, fixed capital formation, and labor force growth. The explanatory variables for the entrepreneurship index equation are economic growth, the number of formal stages of starting a business, trust in ability and skill, and institutional quality index.
Results and Discussion
The results indicate that the variables of economic growth and entrepreneurship have a positive and significant effect on each other, and also the institutional quality variable also has a positive effect on the relationship between the two components. Also, for the OECD countries, the variables of life expectancy, the growth rate of fixed capital formation, and the labor productivity growth have a positive effect, and the total government expenditures hurt economic growth. For the OPEC countries, labor force growth has a positive effect, and total government expenditure has a negative effect on economic growth.
Conclusion and Suggestions
This research seeks to assess the interaction between entrepreneurship and economic growth with an emphasis on institutional quality. Based on the empirical findings, economic growth and entrepreneurship variables have a positive and significant effect on each other, and the institutional quality variable also has a positive effect on the relationship between the two components. According to the results, encouraging entrepreneurship, the growth of the real private sector in the economy, and the reduction of business start-ups to increase economic growth are recommended.
vahid arshadi; hossein amiri; maasumeh barani
Abstract
Introduction Considering the harmful and destabilizing effects of crises and shocks on the business environment, in this study, using panel models and using the annual data of the Scandinavian and MENA countries for the period 2016-2010, the effect of economic resistance indices along with other ...
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Introduction Considering the harmful and destabilizing effects of crises and shocks on the business environment, in this study, using panel models and using the annual data of the Scandinavian and MENA countries for the period 2016-2010, the effect of economic resistance indices along with other macroeconomic variables on the business environment index is examined. By implementing strategies to maximize their country's resistance to shocks, they strive to provide the path and pattern of sustainable economic growth and development with the least strain. Theoretical Foundations In the 1990s, the importance of "business environment" as a link between micro and macroeconomics space was raised in economic literature. The Index of Improvement or Ease of Business environment, due to the nature of its formation, has a new and unique approach that has been put on the World Bank's agenda since 2003 under the title of ease of doing business index. De Soto (2000) has been involved in designing the concept of the business environment and policymaking to remove barriers in the way of the private sector as the main strategy of economic development above all economists. The business environment is an influencing factor on the performance of firms that managers or owners of firms strive to improve. Review of literature Economic resistance including economic growth and improvement of the business environment is a topic that has been studied in recent years, on both national and international levels. This section discusses some of these studies. In a paper using a computable general equilibrium model, Rose (2004), studied the economic resistance of water in Portland, Oregon against simulated earthquakes with a default of 6.1 Richter and water cut-off for 3 to 9 weeks before and after the study period. The existence of a price mechanism under critical circumstances can increase economic resilience. Briguglio et al. (2008) in a study using a systematic model and a composite index analyzed economic resilience and economic vulnerability of 86 countries to the financial crisis in the period of 2001-2003. Based on the two components of intrinsic vulnerability and level of resilience, countries are divided into four categories: 1- worst (high intrinsic vulnerability and low resilience) 2- best (low intrinsic vulnerability and high resilience). 3- self-made (high intrinsic vulnerability and high resilience) and 4- spoiled boy (low intrinsic vulnerability and low resilience). Pakistan and Bangladesh have low vulnerability and resilience. Costa Rica, Estonia, Malaysia, and China are self-made. Developed countries such as Australia, Canada, France, Japan, and Germany have a low intrinsic vulnerability and high resilience (best). Methodology and results This study examines the impact of economic resistance on the business environment for the two groups of MENA and Scandinavia over the period 2010-2016 using a panel data model with the software Eviews8. To this end, we first introduce the panel data model. Panel data is a dataset that observes observations by a number of cross-sectional variables (i) over a given time period (t). In this study, after performing the Unit Root Test and other tests, the model of self-explanation with wide interval (ARDL) and estimation of short-term and long-term coefficients using the integrated group method (PMG) has been used. Conclusion and suggestions The present study examines the impact of economic resistance on the business environment based on Briguglio et al. (2008)'s model of economic resilience using a panel data model for Scandinavian and Mina countries during 2016–2010. The results of this study showed that both groups of Scandinavian and MENA economic resilience index have a positive and significant effect on the business environment index. In Scandinavia and MENA, GFCF and Inflation Rate (IF) have a positive and significant effect on the business index. Foreign Investment (FDI) and Per capita Production (IG) have a positive and significant effect on MENA. But for the Scandinavian countries, it has no significant effect on the business index (DB). According to the results of research in the countries under study, it is necessary to consider the following to improve the business environment, especially for productive economic sectors (industrial and agricultural): Improving the resilience of the national economy by improving the efficiency of the government's financial system and monetary system; Applying the component of economic resistance, extroversion approach by increasing the diversity of export goods and trade parties of the target countries; Reducing government deficit by less harmful methods The focus of creating productive employment in economic programs; Taxation of large incomes of unproductive sectors; Lack of reliance on exogenous variables to provide national resources such as oil revenues; Proper use of domestic financial capital by improving the business environment;
faezeh shadlu; tahereh akhoondzadeh
Abstract
Extended Abstract Introduction Democracy is one types of sovereignty, and its specific aspect is the formal declaration of the principle of the affiliation of a minority with the majority and the recognition of the freedom and the equal rights of individuals and citizens (Alem, 1996: 293). Since Pericles ...
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Extended Abstract Introduction Democracy is one types of sovereignty, and its specific aspect is the formal declaration of the principle of the affiliation of a minority with the majority and the recognition of the freedom and the equal rights of individuals and citizens (Alem, 1996: 293). Since Pericles defined it as "the sovereignty of the people", until today that its consolidation and development in various western schools of thoughts, especially in the United States, is considered as the basic and specialized duty of the government, democracy has gone through major changes. As a result, it could not be studied separately from the economic and social conditions, and the actual and practical situation of society should be taken into consideration. In the final analysis, any democratic structure or system, as a form of political organization of community, serves as a certain mode of production and is determined by it. The theme and form of democracy have been evolved throughout history and has, always and completely, been closely dependent on the related socio-economic formations. In general, democracy is a form of governing that its power source is people, in which the choices of rulers are with the people and government affairs directly or indirectly governed by the people themselves. Economic development and political structure are closely interconnected. The success and duration of every political structure, whether totalitarian or democratic, depends on economic development, economic efficiency, and the quality of the government's economic policies. Real democracy could not be achieved without the equal participation of women in all institutions as well as proper access to education. Methodology This study seeks to examine the impact of economic development, education, and gender equality on democracy among a selection of OPEC countries, including Iran, Saudi Arabia, Kuwait, Venezuela, Qatar, United Arab Emirates, and Algeria, in over 2006-2016 using the generalized method of moments (GMM). The Democracy Index of the Economist Information Unit (EIU), annually shows a general picture of the state of democracy in the world; this index is based on 60 indicators grouped in five different categories measuring election method, pluralism, civil liberties political participation, and political culture. This index covers a range of 1-10 and categorizes countries as one of the four regime types: full democracies (8-10), flawed democracies (6-7/9), hybrid regimes (4-5/9), and authoritarian regimes (less than 4). The Human Development Index (HDI) measures the average achievements in a country in three basic dimensions: health, education, and income. The indicators of these three dimensions are calibrated and combined to generate an HDI score between zero and one. In addition, the percentage of enrollment in primary School (SC) is used as a measure of education. Gender equality is calculated by the percentage of women labor force (LA), the political participation of women in the National Parliament (SE), and the Gender Development Index (GDI). Results and Discussion According to the model estimation results, from the indices measuring economic development, namely GDP per capita and energy use, the former has a negative relationship with democracy while the latter has a positive link with democracy. Negative and meaningfulness of GDP per capita indicate that there is an inverse relationship between oil revenues and the level of democracy and political freedoms in oil-rich countries, as demonstrated by researchers like Friedman (2006) and Wacziarg (2011). In other words, based on these studies and the results of present study, it can be stated that by increasing oil revenues, the level of democracy in oil-rich countries has been reduced. As a result, there is a negative impact on the quality of people’s lives and their social welfare. The positive sign of energy use per capita, as an indicator of consumerism as well as a criterion for increasing economic growth, reflects the fact that people in oil-rich countries, who have a strong tendency to taking advantage of the modern features of the civilized world and are obsessed with new (and probably high-consumption) goods, may welcome democracy as a new commodity. Education also has the task of preparing students for the citizenship of the international community. The more foundation of democracy is been valued at the elementary education, the more the child will be prepared to accept a democratic society. Consequently, the government have to move in the same direction and respond to a generation that has been taught with the principles of democracy from their childhood. There is also a positive relationship between democracy and women's political participation. On the one hand, the real democracy is not realized without full and equal participation of women in all institutions. On the other hand, women’s equal rights in public and political life will fully be recognized just in the presence of democracy. What is evident in the current study is that all of the studied countries have been able to achieve the indicators to some extent by reaching an acceptable level of human and economic development over the studied years. Existence of a positive relationship between some of the above-mentioned factors suggests that the aforementioned countries should create necessary conditions and fundamental institutions to materialize democracy-related goals and public participation, and reduce their focus on oil revenues as much as possible.
Reza ranjpour; Mohammd reza salmani; zahra Karimi Takanlo; nosrat mokhtarzade khanghahi
Abstract
Exchange rate fluctuation is one of the most important economic variables which its impact on some macro indicators has changed the motivation of economic activists and has also affected the production of economic sectors. Therefore, in this article we have attempted to examine the impact of currency ...
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Exchange rate fluctuation is one of the most important economic variables which its impact on some macro indicators has changed the motivation of economic activists and has also affected the production of economic sectors. Therefore, in this article we have attempted to examine the impact of currency shocks on the performance of sub-industry in the East Azerbaijan Province. To this end, firstly, currency shocks were calculated with the help of the model of the generalized autoregressive heterogeneity variance and were introduced into the model as an explanatory variable. Then using the panel data based on the patterns of the variable and dynamic coefficients and pmge technique were analyzed and its impact on industry value-added of 23 sub-sections of East Azerbaijan Province based on two-digit codes of ISIC-REV4 for the period of 2000-2013 were studied. The results showed a positive and significant effect of variables such as capital, workforce, and export on the value-added of sub-industry in East Azerbaijan Province. Of the 23 industry subsections of the province, currency fluctuation has positive and significant impacts on only four subsections. This effect has been negative for each of 9 subsections, therefore, the fluctuation of real effective exchange rate has adverse impacts on the value-added of Province, and especially on the fluctuation of the production of 9 subsections.
Methodology
The purpose of this study was to investigate the effect of currency shocks on sub-sections of the industrial sector in East Azarbaijan Province. To do this, the effects of the exchange rate fluctuations affecting the value added of the industry sub-sections were examined through econometric models in order to determine which section is more vulnerable to exchange rate fluctuations. Based on theoretical foundations, the implicit form of the research model is offered as follows:
(1)
Where kav, erv, er, and x are respectively value added, the real effective exchange rate, the real exchange rate fluctuations and other factors affect the value added. Given the nature of the research and the purpose of the research, the Solo Growth Model (Aghion et al., 2009) used for the value-added function is as follows:
(2)
In this model, i represents the segment and t represents the time:
Logarithm of the real effective exchange rate, Uncertainty real effective exchange rate, logarithm Value added, Logarithm of the amount of available cash, Logarithm of the number of active labor force, logarithm of the value of the export value.
As stated above, the main objective of this study was to investigate the impact of currency exchange on various economic subdivisions of East Azarbaijan Province. Therefore, the study consists of two steps. In the first step, using the generalized conditional differential equation variance model, the exchange rate was calculated. In the second step, by introducing this variable in the model and using dynamic panel and dynamic variable coefficients and the PMGE technique, the effect of exchange rate uncertainty on 23 sub-sectors of the East Azarbaijan industry will be analyzed. According to the above-mentioned questions, the two generalized conditional non-conformance autoregressive variance techniques and the data panel were used to investigate the problem.
Results and discussion
In this study, 23 sub-sections of the industry sector in East Azarbaijan Province were selected based on two-digit ISIC-REV4 codes for the years between 2000-2013. The data and statistical information of the research variables were collected by the Central Bank, the World Bank and the Office of Management and Budget Program of East Azarbaijan Province.
In order to estimate the real effective exchange rate uncertainty, different GARCH, EGARCH models were estimated for a real effective exchange rate. Then based on the Jenkins Box and the AKA and Schwartz criteria, the best method to estimate the uncertainty of the real effective exchange rate of EGARCH (1, 1) was selected.
Before performing the panel coagulation test to determine the long-run relationship between the main indexes of the study, a single root test should be performed to prevent the occurrence of a regression problem for the variables. In this study, for determining the reliability of panel variables, the Fisher's root test was used, and the root test of the generalized Dickey-Fuller unit was used for root unit testing of the time series. All of the variables were accumulated from the first order. To examine the long-term relationship between variables, Pedroni's co-integration test was used, and the existence of such a relationship was confirmed.
After the root tests and a long-term relationship, it was necessary to perform appropriate diagnostic tests to determine the type of model. In order to ensure the meaningfulness of the sample subgroups, a meaningful test of the group was used. The F-Limer's optimal value is 0.028,; therefore, the hypothesis of the effect of the panel is accepted
As previously mentioned, the main objective of the present study was to investigate the effect of volatile exchange rate volatility on the value added of the industrial sector in East Azarbaijan Province. For this purpose, an econometric model was used (Fig. 2). Then, using the proposed model, the method was applied to the target using the panel data method based on the variable and steady-state coefficients. In the present study, the data were used for 23 sub-sections excluded from the study under the tobacco sector due to lack of information. In addition, the export variables, labor force and capital in all the sub-sectors had a significant and positive impact on the value added of the industry, and the exchange rate variable in the sub-sectors had different effects; however, the real effective exchange rate fluctuations in the 9 sub-sections of the industry had negatively impacted and reduced the value added of these sub-sections.
Conclusion
The results showed that the capital had a positive effect on the value added of the subsections so that the amount of this effect was within the range of 1.71 to 3.21, the highest and lowest impact on the non-metallic mineral industries, respectively. In fact, this is in line with the studies of Gelaii (2012) In addition, labor had a positive impact on the value added, which varies from sub-section to sub-section, with the highest and lowest impact on machinery and equipment industries and office machinery. Again this is consistent with the studies of Gelaii (2012). The results indicate that exports in all sub-sectors have a positive and significant impact on value added, which is consistent with the studies of Butang (2015). The value-added variable in any of the sub-sections is not significant, which contradicts the studies of Parhizkari et al. (2013). The magnitude of the coefficient for effective exchange rate fluctuations was only in the 9 sub-sections of the 23 sub-sections, which is negative and significant. This is in line with most studies, which is approximately 0.99 for all of these sub-sections. The estimated coefficient for industry sub-sectors was about 0.99, indicating that one percent increase in currency shocks would reduce over 99 percent of the value added of these sub-sectors.
hassan daliri
Abstract
Introduction
In recent years, reducing the fertility rate has been one of the most important social policy concern in Iran. In this regard, one of the main reasons originates from the country's economic structure. Iran's population increased dramatically during the latter half of the 20th century, reaching ...
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Introduction
In recent years, reducing the fertility rate has been one of the most important social policy concern in Iran. In this regard, one of the main reasons originates from the country's economic structure. Iran's population increased dramatically during the latter half of the 20th century, reaching about 80 million by 2016. In recent years, however, Iran's birth rate has dropped significantly. Studies project that Iran's rate of population growth will continue to slow until it stabilizes above 100 million by 2050. More than half of Iran's population is under 35 years old.
Islamic Republic of Iran has performed well on social indicators, especially in providing basic services such as health care and education. This country with 70 million people has undergone a substantial fertility decline in recent decades. In 1980, Iran’s total fertility rate was 6.58; however, it declined to 1.9 by 2006 with the most rapid decline during the 1990s. Iran’s fertility decline may have proceeded in the two stages of which the first one began in the late 1960s. The Iranian government introduced a family planning program during the 1960s with explicit health and demographic objectives. Between 1967 and 1977, fertility declined (mainly in urban areas) to an average of 4 children per woman. Although the family planning program continued after the 1979 Islamic revolution, it was suspended after the war broke out with Iraq in 1980 (World Bank, 2010).
Theoretical Framework
Economic recession has a multifaceted influence on fertility decisions. There is a substantial literature presenting the economic models of fertility, starting from a seminal work by Becker in the 1970s. Before Gary Becker, fertility choice was widely considered to be outside the realm of economic analysis. Apart from the intellectual tradition, one reason for this was that the data on fertility did not immediately suggest an economic mechanism. Becker (1960) argue that an economic model treating children as analogous to consumer durable materials such as cars or houses can explain the data. His paper departed from earlier theorizing on fertility by demographers and sociologists in two different and equally important ways. First, his analysis assumes that preferences are given. The assumption of given preferences is what puts the “economics” into Becker’s analysis. By ruling out shifts in tastes, Becker’s theory of fertility choice places the spotlight on changes in income and relative prices for explaining trends in fertility. The second departure from earlier theories is the focus of this essay, namely the concept of a quantity-versus-quality tradeoff in fertility choice. Its effects are often differentiated by gender, age (or a position in the life cycle), ethnic, migrant and social groups, and the number of children. Also the ‘opportunity costs’ of childbearing (time, skills and income for childcare and child-rearing) are differently affected by the recession among various social groups. Typically, fertility has a procyclical relationship with economic growth. The expanding literature on the effects of unemployment on childbearing suggests that experiencing unemployment leads to different childbearing propensity for men and women. For childless men, being unemployed or being out of the labor force negatively affects the propensity to become a father. This finding is also consistently reported in many studies of individual countries. Thus, if the main effect of unemployment is on income loss, the generous unemployment benefits or relatively high parental leave allowance reduce the costs of childbearing for the unemployed couples. This hypothesis is also supported by the findings linking the generous parental leave allowances with higher fertility.
Methodology
This study investigates the effect of economic variables (with emphasis on labor market variables, income distribution and housing service) on the fertility rate in the provinces of Iran during 1392-1384. In this study, panel data method was used.
In statistics and econometrics, panel data are multi-dimensional data involving measurements over time. Panel data contain observations of multiple phenomena obtained over multiple time periods (2005-2013) for the same individuals) i.e. Iran’s provinces).
Results & Discussion
The results show that the labor market indicators change people's opportunity cost. So have an effect on the income expectations, and will have an important role on fertility rate in the Iran’s provinces. An increase in the expected income of men in the form of reducing the risk of job loss (i.e. reducing volatility in the unemployment rate, the rate of male underemployment, and the share of male employment in the private sector) or the expected future revenue (i.e. increasing the male employment rate) has improved the fertility rate in Iranian provinces. On the other hand, the labor market variables for women of reduced risk (reducing volatility in the unemployment rate, the rate of female underemployment, and the share of female employment in the private sector ) has increased fertility rates. This has also reduced the opportunity cost of fertility for women and has promoted the income distribution to improve fertility in the provinces of Iran.
Conclusions & Suggestions
The results of this study indicate that economic variables have a significant effect on fertility rates. Therefore, policymakers can provide ways to increase fertility rates by changing economic variables. This experience has also been used in many countries. For example, reduced risk in the labor market; increased job stability; Job support for childbirth (women’s Maternity leave, Child allowance; Powerful Social Security et al.,), Improved income distribution policies.
Habib Ansari Samani; Razieh Davoodi
Abstract
Value Added Taxes, as a suitable substitute for all types of sales taxes, despite the benefits, lead to disadvantages such as the pressure on the general level of prices (Ikpe & Nteegah, 2013). As inflation has always been one of the most important problems in the Iranian economy, it was a concern that ...
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Value Added Taxes, as a suitable substitute for all types of sales taxes, despite the benefits, lead to disadvantages such as the pressure on the general level of prices (Ikpe & Nteegah, 2013). As inflation has always been one of the most important problems in the Iranian economy, it was a concern that in a situation where the country faces a severe structural inflation and inflationary sanctions, will the implementation of the value added tax program increase inflation?
Taking into account the predictions made by the researchers and the executives of the project, we aim to study the issue. 7 years have passed since the VAT was implemented, therefore, it will be necessary to survey the effects of this tax. This paper will survey the inflationary effects of VAT in Iran provinces.
Theoretical Framework
Implementation of value added tax (VAT) from two direct and indirect channels affects the general level of prices. Since the value added tax is an indirect tax based on consumption, a portion of this tax burden is imposed on the final consumer. As a result, implementation of VAT, at least in the early stages, directly leads to a leap in the price of goods and services that are taxed.
Also, the implementation of the value added tax affects the general level of prices indirectly by affecting determining factors of inflation, such as liquidity, expectations and production costs. Experiences of different countries in controlling inflationary effects of VAT show that there are two issues in this regard. The first is which tax does VAT replace? (Which taxes have been eliminated) and the second is the country’s monetary situation (Tait, 1988). If the value added tax replaces one or more direct and indirect taxes, it does not impose a severe pressure on prices because the amount of tax received from the goods does not change much, and only the types of taxes and taxation methods change.
The study of other countries’ experiences shows that if inflation control is one of the main goals of monetary and credit policies and that the government in monetary and financial policies takes into account the issue of inflation, then the implementation of the VAT system along with the inflation controlling short-run policies can be made without a sharp increase in prices (Naderan & Ranjabarkey, 2008).
Methodology
In order to test the hypothesis that VAT has a positive and significant effect on inflation in Iran's provinces, we use provinces variables such as inflation, effective rate of VAT, unemployment rate, current and construction, local government size, oil and without oil production per capita, and the ratio of deposits to production from 2008 to 2013. The Econometric hypothesis testing method is a multivariate regression analysis with panel data.
Findings
The findings show that there is a positive and significant relationship between unemployment rate and provinces’ inflation, which shows the stagflation in Iran's economy Moreover, the current size of the government has a positive effect on inflation, since an increase in government spending will lead to an increase in the budget deficit, public sector debt will increase, and will lead to an increase in the supply of money. Given the positive relationship between the general level of prices and liquidity, raising the money supply will lead to an increase in the general level of prices. Whatever the state budget allocates to development expenditures and government development expenditures by improving production and strengthening the supply side will cause macroeconomic surpluses and will reduce inflation. Since VAT affects the sale price of final goods, it is likely that sellers will conceive of increasing production costs and transfer tax burden to consumers. On the other hand, some manufacturers of goods that are not subject to VAT imagine that the tax on their goods and services will also apply and increase the price of their goods. Therefore, the findings show that there is a positive and significant relationship between the value added tax and inflation in the provinces of the country. The high ratio of deposits to production in the in the ceteris paribus situation indicates that people prefer to hold liquidity in banks. This liquidity will be driven by investment in the supply of various sectors of the economy and will reduce inflation. An increase in domestic production of oil will lead to an increase in the supply of foreign currency and, subsequently, a decline in the exchange rate. Due to the negative relationship between the exchange rate and the rate of inflation, the exchange rate cuts have led to an increase in inflation, and the negative relationship between oil production and inflation is justified. Also, the findings show that there is a positive and significant relationship between the oil-free domestic production and inflation in different provinces.
Conclusions and Suggestions
In this study, the inflationary effects of VAT were investigated using multivariate regression in panel data. For this purpose, after collecting provincial data, the inflation effect of VAT in a model with dependent variable of price level growth rate along with the major variables affecting inflation was measured. Given the positive impact of VAT on inflation, it is recommended that the government initially takes caution in increasing the VAT rate, and secondly, pay closer attention to direct taxes and alternative VAT taxes that have high incomes and low inflationary effect.
amirreza souri
Abstract
Since the end of the Second World War, international trade has grown faster than the world production in nearly a year. In this period, trade among the developed nations has increased much faster than trade in general accounting for an increasing proportion of total trade. Balassa (1966) and Grubel (1967, ...
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Since the end of the Second World War, international trade has grown faster than the world production in nearly a year. In this period, trade among the developed nations has increased much faster than trade in general accounting for an increasing proportion of total trade. Balassa (1966) and Grubel (1967, 1970) demonstrated the importance of simultaneous increase by all countries regarding their exports of most industries. The pioneering studies of the gravity model were realized by Tinbergen (1962) and Pöyhönen (1963). The gravity model is analogous to Newton's law of gravity, where the state gravity between two objects is directly related to each other and inversely related to distance. Anderson's (1979) and Deardorff (1998) have considered that the gravitational equation helps explain the pattern of international trade.
In the 1980’s, Romer (1986, 1990), and Lucas (1988) studied the endogenous growth models. Endogenous growth theories identify a number of channels that affects growth, such as productivity, human capital, and openness. Most of the studies show that trade and economic growth are positively correlated.
When economic geography was born in 1990’s some authors as in Krugman (1993) explained the relationship between North and South considering the mobility between the countries. This process involves trade flows, migration, and direct foreign investment.
In last years, a number of gravity models have been applied to explain the bilateral trade flows (Egger 2002; Serlenga & Shin 2007; Faustino & Leitão, 2008).
The objective of this paper is to examine the pattern of Iran trade by adopting an argument gravity model. The manuscript uses a panel data approach. This study analyses the link between gravity model and Iran trade. The manuscript considers the determinants of Iran and and D8 countries within the years of 2006 to 2015. This study uses country-specific characteristics (per capita income, market size, geographical distance, and factor endowments).The structure of the paper is a follows.
This model is analogous to Newton’s law of gravity, which states that the gravity between two objects is directly related to their masses and inversely related to their distance.
Where Fij denotes the flow from country i to country j. Yi and Yj are the economic sizes of the two countries, usually measured as the gross domestic product (GDP), or per-capita GDP. Dij is the distance between the countries. G is a gravitational constant.
In order to facilitate the econometric estimations, we apply logs the gravity equation (1), hence, we obtain a linear relationship as follows:
Where lnG corresponds to the intercept, while , and are elasticity’s.
According to the gravity approach, the trade between the two countries is directly related to their incomes (or per-capita incomes) and inversely related to the distance between them.
Since the pioneering studies of Tinbergen (1962), Pöyhönen (1963), Anderson (1979), Pagoulatos and Sorensen (1975), Caves (1981), Toh (1982), Krugman, (1997), and Badinger and Breuss (2008) the geographic distance has been an important determinant of trade. The distance can be analyzed in terms of geography, culture, language, and adjacency (Border). Rauch (1999) and Eichengree and Irwin (1998) emphasize the importance of border and common language.
Anderson (1979) introduced the product differentiation by country of origin assumption. A few years later Bergstrand (1985), Egger (2002) and Grossman and Helpman (2005) used the income per capita to specify the supply side of economies.
Usually geographic distance measures the cost of transport. According to the literature there is an increase in the flow of trade if the transportation costs decrease. The theoretical predictions show a negative correlation between distance and the trade. Balassa (1966), Balassa and Bauwens (1987), Stone and Lee (1995), Clark and Stanley (2003), and Badinger and Breuss (2008) found a negative sign between geographical distance and trade.
The empirical model uses the dummy variables to the cultural distance, language, and to the border.
The similarities of the countries encourage bilateral trade. Frankel et al. (1998) and Papazolou et al. (2006) demonstrate the importance of these qualitative variables to analyze the regional trading agreements (RTAs).
Balassa (1966) and Balassa and Bauwens (1987) found a positive sign. The empirical studies show that gravity models utilize gravitational factors as in volume of trade, capital follows, and migration (Baltagi et al., 2003; Faustino & Leitão, 2008; Kabir & Salin, 2010; Leitão & Faustino, 2009, 2010; Serlenga & Shin, 2007; Skabic & Orlic, 2007; White, 2009).
Where is bilateral trade (exports plus imports), is a set of explanatory variables.
All variables are in the logarithm form; is the unobserved time-invariant specific effects; captures a common deterministic trend; e is a random disturbance assumed to be normal, and identical distributed (IID) with .
The combined data used within the period of 2006 to 2015 for each of the commodity groups HS28 (inorganic chemical products), HS29 (organic chemical products), and HS38 (various products of the chemical industry) with a large database and in a minimum method ordinary squares, fixed effects, and random effects are estimated. The results of the study showed that the explanatory power of the model was high for all the three groups of products and the volume of trade of the HS28 commodity group with regard to the GDP of the exporters and the GDP of the importers,.Meanwhile, the size, economic dimensions, and the per capita income have significant direct effects. Trade imbalance and distance have a significant but inverse effect on the business flow of the countries under study.
Mohammad Salimifar; Mahmoud Hoshmand; Mehdi Behname; Nava Ramezanian
Abstract
Introduction:
It was often believed that countries with natural resource abundance would undergo the process of development with a more accelerated pace in comparison to other countries. The experimental results, however, demonstrate a higher rate of success for countries which lack the said resources. ...
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Introduction:
It was often believed that countries with natural resource abundance would undergo the process of development with a more accelerated pace in comparison to other countries. The experimental results, however, demonstrate a higher rate of success for countries which lack the said resources. The paradoxical effects of the possession, or a lack there of, natural resources on different countries has led scientists to study the correlation between the abundance of natural resources and various aspects of development. To that end, the effects of possessing abundant oil resources on human development were studied for a selection of 20 oil-exporting countries between 2002 and 2012.
Theoretical Framework:
In the economic literature on the resource curse hypothesis (RCH), there are three general views:
One. On one hand, it would appear that the abundance of natural resources should act as a driving force and procure an accelerated pace of development and growth for the possessing countries. The reason for such an expectation is the access these countries have to resources that can bankroll their goals.
Two. On the other hand, most countries with notable natural resources, especially Oil dependent ones, have not fared well in way of achieving development in recent years, whereas a considerable number of countries that have achieved growth and development possess few natural resources.
Three. Passing judgments on the role of natural resources would have been rather easy if all the collected data was consistent with one of the above-mentioned observations. The problem escalates in severity because some countries with significant natural wealth also rank very high in terms of sustainable economic growth and human development.
Since 65 countries in the world have resource-based economies; the question of why having natural resources has led some countries to growth and human development, and others quite the other way is of utmost importance.
Methodology:
Based on the theoretical bases and previous studies, the quantitative model used in this research is specified as follows:
HDIit= αit + β OGSit + γ HPCit + θ GDRit + δ VAIit +ɛit
t= 2002, 2003… 2012
In this model, the dependent variable is the Human Development Index (HDI), and the OGS (main variable) shows a country's dependency upon oil resources. HPC, GDR, and VAI are the control variables in this model and they represent the growth rates of per capita health expenses, gross domestic product growth and the degree of Voice and Accountability, respectively.
The dataset for this study consists of the oil-exporting countries whose share of revenues from oil exports makes at least 50% of their total export revenues, which include a total of 20 countries from Middle East, Central Asia, Africa and North and South America (unbalanced data).
The research methodology for this study is analytic-descriptive, and the econometrics approach is as follows:
According to Levin-Lin-Chu test, all variables are stationary. To select the most appropriate designed estimation model, four tests were used, namely Chow, Hausman, Breusch-Pagan and F-ANNOVA, which their results indicated that the model should be estimated using panel data approach with fixed effects. Also, autocorrelation among error components, collinearity and heteroscedasticity are henceforth examined. Consequently, the HPC variable must be taken out of the model. But, In order to prevent from specification bias, important dummy variable of financial crisis should be added. Moreover, the model must be estimated using AR (1) with Estimated Generalized Least Square (EGLS) method.
The final model is defined as follows:
HDIit= αit + β OGSit + γ DUit + θ GDRit + δ VAIit + λ AR (1) +ɛit
t= 2002, 2003… 2012
Results & Discussion:
According to estimations, there is a significant and positive relationship between the OGS and HDI in the studied countries between 2002 and 2012. This result is consistent with works of Gylfason (2001), Lederman and Maloney (2008) and Pineda and Rodriguez (2010). In addition, it is predicted that GDP leads to a higher level of HDI in the country.
The rate of the GDR reflects the fact that a 1% increase in the rate of economic growth increases the human development index by 0.001 units. Managing resources export revenues in different levels of human development leads to gross domestic product (GDP) having a more significant effect on HDI. Thus, the resource curse hypothesis proposed by Sachs and Warner (1995 and 1997) and Gylfason (1999) cannot be confirmed.
Also, the dummy variable has had a negative impact on the level of HDI for these countries, a result that is also consistent with the theoretical bases of the study. However, the voice and accountability variable, has no significant effect on the human development of oil dependent countries in this model.
Conclusions & Suggestions:
The RCH cannot be approved. Because, first, despite the fact that most of selected countries with abundant natural resources have set a trend in terms of not being successful in achieving development, some of these countries, such as Botswana, Indonesia, Chile, Norway, Australia, Canada and Malaysia have not followed the trend.
Second, it is unclear whether the resource curse and its different aspects are related to a variety of natural resources or just one type.
Third, some studies have reported observations that disprove the resource curse hypothesis, although the same indicators were used in order to present the abundance of natural resources in the studied subjects.
Moreover, when each components of HDI was analysed, the outcomes showed that the effect of oil resources revenues on Human Development Index can be positive (especially on non-income components such as education and life expectancy).
Consequently, development of health education, such as educating the female members regarding their roles in the upbringing of children, and the prevention of contagious diseases in order to improve the human development index is needed. Also, allocating a greater portion of the resources’ revenues to investment in human and physical resources in order to accelerate economic growth is highly recommended.
gholamreza zamanian; javad harati; Hojat Tagizadeh
Abstract
Introduction
In 1980s many countries to finance their spending,used internal resources, especially bank credits. Government spending financing by non-bank was used in low level, because capital markets had not formed or were not strong in most countries and also financial assets were not available. ...
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Introduction
In 1980s many countries to finance their spending,used internal resources, especially bank credits. Government spending financing by non-bank was used in low level, because capital markets had not formed or were not strong in most countries and also financial assets were not available. After World War II and the effectiveness of US aid to Europe, several articles were written about the impact foreign aid. Some theories believe that foreign aid such as loans, block grants can provide economic growth, but increased lending to developing countries in the 1970s and followed debt crisis in 1982 quesioned the impact of external debt on economic growth.
According to International Debt Statistics published by the International Bank for Reconstruction and Development in 2015, total external debt of developing countries is about 5506 billion dollars, which Iran's share is 7647 million dollars . According to the report, China is the largest debtor among developing countries so that the external debt of this country is about 874 billion dollars. China's external debt in 2013 has increased more than 6 times than 2000.
One of the main challenges which most developing countries facing, is ways of financing the budget deficit and its impact on economic growth in these countries. Choosing financing instruments, especially liabilities are important for rapid economic development and being aware of the impact of these policies on macroeconomic variables is very important. How to finance the budget deficit is the key to financial sector reform. The purpose of this study was to estimate the effects of external debt, budget deficits and exports on economic growth in developing countries. For this purpose,panel data for the period 2003-2013 and GMM estimation method have been used.
Theoretical frame work
In general, there are three views to the use of external resources. The first view is theories that consider external sources important for growth and economic development. This view suggests that developing countries are known poor economies in terms of low savings and capital and low investment. In fact, developing countries because of low saving rate can not finance expenditures related to depreciation and replacement of capital goods. As a result, for such countries, external resources are critical to reach ideal economic growth. The second view includes theories that foreign aid is not essential for growth and development. Bauer and Yamey (1989) believe: "For developing countries, foreign aid is not necessary or sufficient for liberation from poverty, but it is possible to grow and develop without foreign aid if necessary conditions are provided and economic and social projects are done. Also if these conditions are not provide, economic development is not possible, even with the presence of foreign aid and foreign resources will be wasted ".The third view includes those views which know foreign unsufficient condition for economic growth, but believe that proper management of external debt, provides the possibility economic growth and development. The management includes allocated loans to the production of export goods and prevents the losses of received aid and so on (Gharabaghi, 1993).
Theoretical models about growth and foreign aid includes two gap patterns, Griffin theory, model three gaps and overhang hypothesis. Before the two-gap model, growth patterns often proposed based on the savings gap, But Chenery & Bruno (1962) showed savings gap is not the only limiting factor. Griffin (1970) by statistical analysis revealed that only 25 percent of the external debt is allocated to growth activities. In the other words , 75% foreign loans taken for consumption expenditures. One of the main criticisms about the two gap pattern was that received foreign loans apart from the savings and exchange gap may be due fiscal gap and budget deficit reduction. So third limitation was introduced for the growth, was the limitation of public financing gap. Bacha (1990) suggests that the economy could fill three gaps savings, foreign exchange and Budget deficit by external sources and enter the growth path. One of the main channels which external debt impact on economic growth through it, is Debt overhang (Krugman, 1988; Sachs, 1989). Large debt burden is an obstacle to investment, because investors expect return on investment reduce due to foreign creditors.
Methodology
In this study, the model Jayaraman & Liu (2009) is used:
That, RGDP represents real production as a numerical index, ED real external debt (GDP%), EXP real exports of goods and services (GDP%), BD real budget deficit (GDP%) and ε random error term. consumer price index (CPI) is used for real nominal variables. In this study the generalized method of moment's (GMM) is used to estimate the model. GMM estimator is developed by Arellano & Bond (1991) and Arellano & Bover (1995). Gmm estimation method used the two sets of cross-sectional data and time series data. The method can solve the endogeneity problems between explanatory variables. In this method, dependent variable is added to the equation with a lag as an explanatory variable (Abrishami et al., 2006). To solve the correlation between the lagged dependent variable and the error term, lag variables are used as instruments in GMM. Also consistent estimators of GMM, depends on the validity of the instruments used. To test this, the use of statistics proposed by Arellano & Bond (1991) and Arellano & Bover (1995), which is called Sargan test and validate the instruments used to measure (Yavari, et al.2010).
Results & Discussion
Based on the results, the total external debt and budget deficits have negative impact on economic growth so that one percent increase in the total external debt reduced economic growth by 0.7%. Also increase one percent in the budget deficit reduced economic growth 0.035%. While exports have a positive impact on economic growth so that one percent increases in exports increase economic growth 0.21%.
In the second model, short-term external debt has positive effects, but long-term external debt has a negative impact on economic growth. So that a one percent increase in short-term external debt, increases economic growth 0.032% and with an increase in long-term external debt, reduces economic growth of 0.12%. Budget deficit has a negative impact on economic growth, while exports had a positive effect, as a one percent increase in budget deficit, reduced economic growth 0.005% and a one percent increase in exports increased 0.24%.
Also estimated results for the two groups of countries: countries with upper-middle per capita income and lower-middle and lower-income countries , have been reflected. According to estimates, total external debt in both countries has a negative impact. While short-term external debt has positive impact on economic growth, but long-term external debt has negative impact on economic growth. Budget deficit and exports in countries with low and lower-middle income have positive impact on economic growth, while the upper-middle income countries have negative effects.
Conclusions & Suggestions
The results show that, long-term external debt and budget deficit have significant negative effects on economic growth in developing countries. However, exports and short-term external debt have positive impact on economic growth in developing countries. While the external debt is divided into 2 groups: short-term and long-term external debt, the results show that short-term external debt have positive impact on economic growth but long -term external debt have negative impact on economic growth. However, the budget deficit is a negative impact on economic growth but exports have positive impact n economic growth. According to the results, measures to reduce long-term external debt should be taken in developing countries and prevent the adoption of long-term debt or long-term debt become short-term debt. Also, due to the positive impact of exports on economic
fatemeh khani; Mahmood Hoshmand
Abstract
Economic performance over time, is largely dependent on environmental policy, institutional and legal countries. Also nowadays development Industrial exports is known as the one of the best goals of economic development. The issue for many developing countries are often exporter of raw materials is important. ...
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Economic performance over time, is largely dependent on environmental policy, institutional and legal countries. Also nowadays development Industrial exports is known as the one of the best goals of economic development. The issue for many developing countries are often exporter of raw materials is important. Therefore, understanding the factors influencing industrial exports are necessary.
Hence, this study using panel data to investigate the impact of institutional quality on the export of industrial products for 14 samples from selected developing countries, between the years 2002 and 2012. In the paper than the average six indicators of good governance in the period under review as institutional index is used. In addition to the institutional index of two variables, GDP and real exchange rate countries were used as control variables.
The results confirm this hypothesis that improvements in institutional quality has a positive effect on the supply of industrial products export to countries in the study. And this study shows that to increase export supply in the countries In addition to removing financial barriers such as exchange rate should try special attention made to improving institutional quality.
hasan rezaee; mostafa salimifar
Abstract
Development of financial markets as an important factor in the economic growth process always has been of interest to economists. The purpose of this paper is to study the relationship between regional financial development and economic growth. This study uses provincial annual data over the period 2000-2011 ...
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Development of financial markets as an important factor in the economic growth process always has been of interest to economists. The purpose of this paper is to study the relationship between regional financial development and economic growth. This study uses provincial annual data over the period 2000-2011 by using panel data technique. The panel co integration techniques have been used to test and estimate the long-run equilibrium relationship between real GDP and the financial development indicators.
The results show that long-run positive relationship exists between the variables of insurance, banking and stock with economic growth. There is no Short- run causality from stock market to banking sector, But there is bidirectional causality between other variables in the short run and long run. In the long-run, volatility of GDP mainly described by the Impulse of GDP (59.7%), stock (29.74%) and little amount (0.5%) by bank ing development.
Farzaneh Ahmadian Yazdi; Mohammad Hossein Mahdavi Adeli
Abstract
Human capital (labor quality or knowledge embedded in human beings) is one the important issues in recent decade, because concentrating on this kind of capital can improve products and can make economic growth and development. This study has been investigated effective factors on human capital, emphasis ...
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Human capital (labor quality or knowledge embedded in human beings) is one the important issues in recent decade, because concentrating on this kind of capital can improve products and can make economic growth and development. This study has been investigated effective factors on human capital, emphasis on resource abundance for OPEC countries in period 2000-2012. To achieve that object, Arturo human capital’s model has been utilized; also according to economic nature of these countries, oil rent variable has been added to this model. For estimating coefficients, panel data method has been used. Based on results, resource abundance has negative effect on human capital accumulation, thus the coefficient is equal to -0.11. There for the more oil rent will lower the economic growth in these countries. Also based on results, the relationship between life expectation and economic growth and human capital is positive and the coefficients are 1.84 and 0.26. In addition to those results, population growth has negative effect on human capital accumulation; its coefficient is equal to -0.08. So population growth policies can’t be suitable for OPEC countries because such policies can’t improve human capital in such countries.
Roohollah Babaki; Mostafa Salimifar
Abstract
Abstract
Production is a process by which a productive activity will require some conditions (before and after the start of the production). One of the most important pre-required factors for start up a production unit is suitable Business Environment. One of the most important factors that must be ...
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Abstract
Production is a process by which a productive activity will require some conditions (before and after the start of the production). One of the most important pre-required factors for start up a production unit is suitable Business Environment. One of the most important factors that must be provided after the start of production -During the production process and the time to market and export- is economic freedom.
Hence, this paper explores the impact of Business Environment and economic freedom on economic growth in 30 selected countries during 2004-2013. Panel data estimation results indicate that Business Environment and economic freedom have positive and significant relationship with economic growth.
Our findings show that the impact of economic freedom on economic growth is greater than the Business Environment.
Keywords: Business Environment, Economic Freedom, Economic Growth, Panel Data
JEL Classification: C23, K20, O41, O50
Amir Reza Soori
Abstract
Abstract
In this paper, we analyze the determinants of Intra-Industry trade (IIT) in the Agriculture, Industry and service sectors between Iran and her trading partners, i.e. European Union, ECO, GCC, D8, OIC and ASEAN countries using dynamic panel data and GMM during 1980-2009.
This study uses country-specific ...
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Abstract
In this paper, we analyze the determinants of Intra-Industry trade (IIT) in the Agriculture, Industry and service sectors between Iran and her trading partners, i.e. European Union, ECO, GCC, D8, OIC and ASEAN countries using dynamic panel data and GMM during 1980-2009.
This study uses country-specific characteristics such as economic size, per capita income, foreign direct investment, geographical distance, and trade imbalance as explanatory variables. The results indicate that economic size, per capita income, and geographical distance explain most of IIT between Iran and her trading partners. According to econometric findings, the economic size has high and positive correlation with IIT, however per capita income affects negatively IIT. Thus, differences in aggregate demand and supply should be considered in selecting trade partners. The similarity in income structure leads to same demand structure and expansion of trade volume. In addition, geographical distance and trade imbalance has negative effect on IIT flow in Iran.
Keywords: Intra-industry Trade, Regional blocs, Dynamic, panel data, Economic scale, GMM
JEL Classification:C20 , F12.
Jaber i Bahram; Mosayebi Pahlavan
Abstract
Abstract
Of the issues facing present age countries is the phenomenon of globalization. Globalization, mixture and integration of national economies into the global economy is whose effects can be considered in increasing international trade, globalization of production and the flow of foreign direct ...
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Abstract
Of the issues facing present age countries is the phenomenon of globalization. Globalization, mixture and integration of national economies into the global economy is whose effects can be considered in increasing international trade, globalization of production and the flow of foreign direct investment. Investigated broad effects and consequences this process on various aspects of human life including political, economic, social and cultural has attracted Particular attention of thinkers, politicians, economists in worldwide. This investigation, first of all need to quantify this phenomenon, construction and use of appropriate indicators to measure it.
The aim of this study is the investigation of the globalization effect by using a new integral index of economic globalization, KOF on attracting foreign direct investment in selected countries, member of the MENA and 20 year’s period is 1990-2009. Research model was estimated by using panel econometric techniques such as panel unit root, panel co-integration and GMM. The results of research implies a significant and positive relationship between globalization and foreign direct investment. Also the size of the market index, the human capital index have positive and significant impact and population parameters on attracting foreign direct investment has a significant and negative impact.
Key words: Globalization, Foreign Direct Investment, Panel Data , GMM, MENA Countries.
JEL Classification: C23, F23, F62.
Mehdi Behrad-Amin; Gholamreza Zamanian
Abstract
University of Sistan and Baluchestan
Abstract
The exchange rate as a key variable in economic policies have been considered. Moreover , the volatility and uncertainty of exchange rates and their effects on international trade in terms of policy is extremely important. Although most trade models ...
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University of Sistan and Baluchestan
Abstract
The exchange rate as a key variable in economic policies have been considered. Moreover , the volatility and uncertainty of exchange rates and their effects on international trade in terms of policy is extremely important. Although most trade models argue that exchange rate volatility increases the uncertainty and risk and therefore reduce trade flows, including imports, however, some studies suggests the opposite. This study investigates the impact of real exchange rate uncertainty on import demand of member countries of the MENA. The period of study is during 1980 – 2012. The EGARCH model is used to generate the log of GARCH variance series and the panel data with random effects method was used to estimation of the model. The variable of real exchange rate uncertainty imposes a negative impact on real import in the long run. In the long run, a rise in real exchange rate uncertainty can improve the country’s trade balance by substantially lowering import demand, but can harm industrial production at the same time. Therefore, stabilization of real effective exchange rate via major nominal exchange rates may deem necessary.
Key words : exchange rate uncertainty, EGARCH, imports, Panel data
JEL Classification : F11, F14, F17, F31
sadegh bafandeh imandoust; Hanie Ghanei Zare
Abstract
Economic Cooperation Organization (ECO) is an intergovernmental regional organization established in 1985 by Iran, Pakistan and Turkey for the purpose of promoting economic, technical and cultural cooperation among the Member States.
The aim of this paper is to study the influence of Economic Integration ...
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Economic Cooperation Organization (ECO) is an intergovernmental regional organization established in 1985 by Iran, Pakistan and Turkey for the purpose of promoting economic, technical and cultural cooperation among the Member States.
The aim of this paper is to study the influence of Economic Integration on foreign direct investment among the ECO countries with utilise of panel data during 1997-2010. The result shows economic integration among these countries has positive relationship with foreign direct investment.
Mohammad-Hossein Hosseinzade Bahreini
Abstract
The Effect of Business Regulations on Economic Growth (A Selection of Developed and Developing Countries)
Mohammad-Hossein Hosseinzade Bahreini
Assistant Professor of Economics,Ferdowsi University of Mashhad
Mohammad Ali Falahi
Associate Professor of Economics,Ferdowsi University of Mashhad
Fatemeh ...
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The Effect of Business Regulations on Economic Growth (A Selection of Developed and Developing Countries)
Mohammad-Hossein Hosseinzade Bahreini
Assistant Professor of Economics,Ferdowsi University of Mashhad
Mohammad Ali Falahi
Associate Professor of Economics,Ferdowsi University of Mashhad
Fatemeh Erfany Jahanshahi
M.Sc. in Economics
Abstract
In this research, the relationship between business regulations and economic growth is examined.
Nowadays, firms face high regulation in starting business, employing production factors and other procedures of business. It seems one of the important obstacles of production and investment is cumbersome regulation in business environment. In different countries of the world, improvement in business environment and removal of obstacles in front of private sector are known as an economic strategy.
In this paper, regarding the importance of the subject, “Hardness of Business Regulations” index is made by using World Bank data for consideration of the effect of business regulations on economic growth. The model is estimated for 62 countries during 2003-2006 by panel data model. The result shows that hard business regulation has negative effect on economic growth in selected countries.
Key words: business environment, business regulations, economic growth, panel data.
JEL: C23, G18, K20
Samira zeidizade
Abstract
Examining Effect of Government Size on Corruption; With Emphasis on the Role of Democracy in MENA
Nazar Dahmardeh
Associate Professor in economics, University of Sistanand Baluchestan
Mohammad Alizadeh
Assistant Professor of economics,University of Lorestan
Samira zeidizade
M.Aof Economics
Abstract
Corruption ...
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Examining Effect of Government Size on Corruption; With Emphasis on the Role of Democracy in MENA
Nazar Dahmardeh
Associate Professor in economics, University of Sistanand Baluchestan
Mohammad Alizadeh
Assistant Professor of economics,University of Lorestan
Samira zeidizade
M.Aof Economics
Abstract
Corruption is an anomalous phenomenon,economic, political and cultural. it exists in some developing and developed countries and because is known as the most important barrier of progress and economic growth, therefore it is necessary to be focused.
The main objective of this paper is to understand the phenomenon of corruption and corruption associated with the identification of variables, including economic and political democracy.
Relationship between government size and corruption in the public sector is a matter of economics, the role of democracy. So this research uses Panel Data during the period 2003-2010 and investigates its impact on the corruption with the emphasis on the role of democracy in the 16 MENA countries.
The results show that expanding the size of government, or low levels of democracy, Can increase the level of corruption in the region. Also Interactive effects of government size and democracy on corruption, the fact that democracy is reduced, a larger size of government, reduce the level of corruption. This is the result of feedback, The low level of democracy, the system of monitoring and control lower, so that, Corruption is shown less , That does not necessarily mean reducing corruption. Therefore, to reduce the level of corruption in government activities,
The spread of democracy, especially freedom of the press and media, and strengthening oversight and accountability system is recommended
Keywords: Corruption; Government size; Democracy; MENA; Panel data.
JEL Classification:C23,D73,H11
, Moslem Alboosoveilem; Hossein Karimi Hosnije; Mohammad NooriBakhsh
Abstract
Abstract
The expansion of Financ system expanding in a country is one of the main determinant factors of foreign investment. Flow and the system is affected by essential factors such as political constancy. Political risks of each country is evaluated by political system figuration, its constancy, policies ...
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Abstract
The expansion of Financ system expanding in a country is one of the main determinant factors of foreign investment. Flow and the system is affected by essential factors such as political constancy. Political risks of each country is evaluated by political system figuration, its constancy, policies constancy and regular rules existence for political competition. This constancy is the most important requirement for doing the international economic transactionsas well. Most of economists believe that high political risk is an important preventive for expanding the finance system and consequently foreign investment attraction.
In this paper, the effect of political risks on finance system expansion and foreign direct investment in the countries in 2001-2007 is studiedby panel data method.
The Obtained results indicate that finance system exponsion up to threshold level leads to foreign investment, but this relation becomes vice versa from ther point to growth the next. Also reverse effect of political risks on foreign investment attraction and finance system expanding is observed in D-8 countries. In addition, objections repression, irresponsibility, violence and political inconstancy, regular burden and irregularity are the most important factors of political risks.
JEL Classification: G15, P16, G21
Keywords: finance system expanding, political risks, foreign direct investment, D-8 countries, panel data.
Alireza Shakibaee; Fatemeh Kobra Bata; Somayeh Heydarabadi
Abstract
Abstract
This paper after studying popularized and economic condition in Iran and Turkey, investigates economic integration trade result of the two countries together and with South West Asia region. in fact the main purpose of this paper is to investigate the trade potential and Its effects on increasing ...
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Abstract
This paper after studying popularized and economic condition in Iran and Turkey, investigates economic integration trade result of the two countries together and with South West Asia region. in fact the main purpose of this paper is to investigate the trade potential and Its effects on increasing bilateral trade between Iran and Turkey.This paper aims to answer this question:
Could trade cooperation between Iran and Turkey and also with other members of South West Asia region lead to the increase of bilateral trade?
In order to answer this question, Generalized Gravity Model was used and it was estimated with Panel Data method. The results indicate that per capital income and geographical distance between them greatly justify economic cooperation between Iran and Turkey. This can lead to an increase in bilateral trade cooperation between two countries. The results also showed that two countries can not have integration with other South West Asia countries.
JEL Classification: F15, F36.
Keywords: Trade integration, Bilateral trade, Generalized Gravity Model, Panel Data.
