Political economy
Farshad Moameni; hojjatollah mirzaei; ali jafari shahrestani
Abstract
Before 1990th, in political economy theories, the security of property rights was to be presumed. The importance of property rights as the underlying factor of economic growth and economic development was first noticed by new institutional economists and then expanded. This paper studied the Marxist ...
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Before 1990th, in political economy theories, the security of property rights was to be presumed. The importance of property rights as the underlying factor of economic growth and economic development was first noticed by new institutional economists and then expanded. This paper studied the Marxist and methodological individualism political economy approaches that have been used by researchers to describe the main reasons for the underdevelopment of Iran with a focus on property rights.The weakness of them all is inadvertence to Iranian historical features and failure to present an independent theory regarding the inefficiency of property rights in the history of Iran. Therefore, using the new institutional approach, which is based on historical studies and society institutions and using them in the analysis of the role of property rights on underdevelopment and not just studying the series of historical developments and geographical features, could be a facilitator. In this way, this paper suggests focusing on these features of Iran:1) Specific climatic conditions of Iran with the lack of water, which is the main reason for tension;2) The effect of climate conditions on political and economical systems (the government theory) and forming nomadism and tribal life and tribal governments;3) The effect of forming those political and economical system on property rights underdevelopment (the property rights theory).
Economic Development
mahya allahgholi; Farshad Moameni
Abstract
Considering the economic complexity index as a development index due to its greater estimation power in predicting economic growth and income inequality compared to similar indices, along with shortcomings such as the inability to express the difference in the complexity levels of economies, it makes ...
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Considering the economic complexity index as a development index due to its greater estimation power in predicting economic growth and income inequality compared to similar indices, along with shortcomings such as the inability to express the difference in the complexity levels of economies, it makes the theoretical model to explain this index inevitable. In the social orders approach, the type of social order is mentioned as the difference between developed and developing economies, and in this article an attempt has been made to identified determinants of this index. In this study by descriptive analytical method the state of property rights, the business environment and the type of people`s access to organizations are known as three variables affecting this index. analyzing Iran`s economic complexity index during 10-period (2010-2020) and three indexes, international property rights, ease of doing business and economic freedom, respectively as an estimation of those variables, shows that the international property rights index has a stronger positive relationship with the economic complexity index than the other two indices.
Game theory
Farshad Momeni; Reza Shohreh
Abstract
Over the past half-century, the impact of the prisoner’s dilemma has transcended its initial boundaries, influencing a broad spectrum of institutional studies and analyses of interdependent systems, such as collective action, public goods, governance of the commons, social norms, and social capital. ...
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Over the past half-century, the impact of the prisoner’s dilemma has transcended its initial boundaries, influencing a broad spectrum of institutional studies and analyses of interdependent systems, such as collective action, public goods, governance of the commons, social norms, and social capital. Given this extensive influence, the latent fundamental flaws in this model can lead to misleading result for researchers and policymakers. As a descriptive–analytical research, the present study employed evolutionary game theory to examine the shortcomings of the iterative and evolutionary prisoner’s dilemma. It went on to introduce an alternative framework to explain the emergence and transformation of institutions. The critical discussion highlighted fundamental deficiencies of the prisoner’s dilemma manifested in four distinct levels of institutional analysis: the definition of institutions, identification of their function, explanation of their emergence, and description of their transformations. Consequently, the model is not capable of explaining institutional issues mentioned above. Addressing the role of uncertainty and considering the impact of small-world networks on payoff distribution, the second part of the study used a semi-parametric stag hunt matrix to model the cooperation problem. The results indicated that the non-spontaneous overlap between strong and weak ties can accumulate synergistic flows between content and structure, creating an environment conducive to institutionalizing capacity for achieving public goods on a large scale. Therefore, the process of overcoming social traps begins not with the punitive rules proposed by the prisoner’s dilemma, but with synergetic institutions that enhance the opportunity to discover common interests.IntroductionThe relation between institutions and development has been well recognized for quite some time. Numerous studies have delved into collective action, public goods, the governance of the commons, informal institutions, social capital, and the like. These areas serve as a common ground between two realms of economics: the theory of institutions and game theory. However, the majority of game theory studies are based on the assumption that the payoff distribution follows the prisoner’s dilemma. In the payoff matrix of the prisoner’s dilemma, the additional benefit of unilateral non-cooperative action results in a dominant strategy, preventing rational players from attaining the mutual benefits of cooperation. The central question in this literature is: how have human beings successfully established society and built civilization? There are three general solutions in the literature on the iterative and evolutionary prisoner’s dilemma. The initial solution, incorporating concepts like meta-game, folk theorem, reputation effect, and the norm of reciprocity, asserts that if the game repeats endlessly, cooperation becomes a foresight-driven choice. Contrary to this approach that suggests a form of spontaneous order, some sociologists argue that negative externalities of individual actions cannot be resolved by foresight or reciprocity, so the evolution of cooperation is only achievable through authoritative relations and punitive norms. The third solution, rooted in a biological assumption, contends that the prisoner’s dilemma can be solved through instincts without the need for rationality. The current article critically examined each of these approaches, and then introduced another payoff distribution matrix to explain how cooperation evolves in human society.Materials and MethodsThis study used a descriptive–analytical method as well as evolutionary game theory.Results and DiscussionThe article can be categorized into two main sections: the critical discussion and modeling. In the critical discussion, the results drawn from agent-based networks indicated that, even in the case of an endlessly repeating game, the emergence of the first cooperators would remain unexplained within the specific payoff matrix. Then, it was demonstrated that a substantial gap between theory and observation arises due to the inadequacy of the Prisoner’s dilemma in representing uncertainty. The discussion also addressed the contradiction stemming from overlooking the institutional context, particularly in defining reciprocity and explaining the emergence of norms. Moreover, the discussion highlighted some tautologies hidden in these definitions and explanations. Finally, three reasons were presented to underscore that the biological approach falls short of explaining how cooperation evolves in small-world networks.The discussions highlight fundamental deficiencies in the prisoner’s dilemma across four distinct levels of institutional analysis: the definition of institutions, identification of their function, explanation of their emergence, and description of their transformations. At the definitional level, the logic is fundamentally flawed due to its oversight of uncertainty as well as the mere emphasis on non-cooperative payoffs. Concerning the identification of function, the model predominantly stresses control and punishment, neglecting synergetic institutions that enhance opportunities to discover common interests, foster social synthesis on a large scale, lay the foundation for social contracts, and legitimize punitive rules. Moreover, an evolutionary model can only explain the endogenous emergence and transformation of institutions if it first demonstrates how a payoff matrix, where non-cooperation is a dominant strategy, can create a sustainable learning process. According to the results of agent-based networks, such a process cannot be explained in the prisoner’s dilemma.Nevertheless, evolutionary models, by sidestepping the assumptions of perfect rationality and information, possess a suitable capacity for studying interdependent systems and institutional analysis. Therefore, an alternative model can be formulated by implementing some reforms, including the utilization of the stag hunt matrix to account for uncertainty, incorporating small-world networks to better align with human societies, and ultimately introducing a semi-parametric payoff matrix to incorporate the influences of social structures.The results from the revised stag hunt model showed that the non-spontaneous overlap between strong and weak ties can accumulate synergistic flows, creating a conducive environment to institutionalizing capacity for achieving public goods on a large scale. Therefore, the process of overcoming social traps begins not with the free ride punishments proposed in the prisoner’s dilemma, but with synergetic institutions that enhance the opportunity to discover common interests.ConclusionThe prisoner’s dilemma describes a great challenge concerning micro-level conflicts of interest. However, using this model to explain the emergence and transformations of institutions is bound to yield highly misleading results for researchers and policymakers. Instead, the theoretical framework proposed in this study should find application across a broad spectrum of institutional studies, including analyzing the impacts of inclusive institutions on overcoming social traps, designing society-oriented methods for governing the commons, explaining the accumulation and modeling the measurement of social capital, and examining the social consequences of economic inequality.Keywords: Institutions, Cooperation Problem, Evolutionary Game Theory, Prisoner’s Dilemma, Stag HuntJEL Classification: C73, O43.
Economic Development
Hossein Rajabpour; Farshad Momeni; Ali Nasiri Aghdam
Abstract
This article considers the effect of fiscal policy on inclusive development. Inclusive development is one of the concepts that has been introduced in the development economics literature in the last decade and especially with emphasis on the social and political aspects of development, the distribution ...
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This article considers the effect of fiscal policy on inclusive development. Inclusive development is one of the concepts that has been introduced in the development economics literature in the last decade and especially with emphasis on the social and political aspects of development, the distribution of development achievements among different sections of society is in focus. Since fiscal policies are one of the main instruments of the government to eliminate deprivation and imbalances, it is important to understand the effectiveness of these policies in this regard. In this study, the components of fiscal policy include the combination of expenditures and revenues and its effect on inclusive development in the period 1981-2018 in the form of two models of structural vector auto-regression has been studied. Findings show that most components of government fiscal policy except economic expenditures do not have a significant effect on the index of inclusive development and these economic expenditures have a negative impact on inclusive development. The results show that the government's fiscal policies have failed to achieve or accelerate inclusive development, and despite its legal mission, the government has not been successful in comprehensive expanding welfare and extending it to all social groups. Historical analysis also shows that since the beginning of the 2010s and with the intensification of sanctions and currency fluctuations, the relationship between fiscal policy and the index of inclusive development has been weakened. It seems that the reform of the budgeting process and the simultaneous attention to the two constraints of equality and sustainability in growth and development targeting for fiscal policy on inclusive development is essential.
Banking
Farshad Momeni; Abbas Shakeri; Javad Taherpoor; Behnam Ezati Ekhtiar
Abstract
In some economic theories emphasizing the positive relationship between financial and real sector development in economy, privatization of financial markets and institutions and increasing private sector share is the dominant approach to financial development. However, private banks performance in some ...
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In some economic theories emphasizing the positive relationship between financial and real sector development in economy, privatization of financial markets and institutions and increasing private sector share is the dominant approach to financial development. However, private banks performance in some countries have shown different results compared to the goals had been set. Lack of proper economic and institutional environment has led to adverse results of private banks. Considering mentioned issues, this study aims to assess the impact of private banking on the economic growth rate in Iran based on the seasonal data form 2003 till 2018 using Autoregressive Distributed Lag (ARDL) technique. Results of the study have shown that financial development has a positive impact on the growth rate of economy, while, as the market share of private banks has increased, it had a negative effect on the economic growth. The main cause of this negative relationship is undesirable institutional environment which private banks are working in. Therefore, preparing suitable institutional framework is a condition to gain the private banks’ advantages. Central bank constant supervision alongside the enforcement authority prohibiting private banks from managing economic firms and the presence in the alternative markets are the main preconditions.
Amir Jafarzadeh; Abbas Shakeri; Farshad Momeni; Ghahraman Abdoli
Volume 19, Issue 61 , February 2015, , Pages 1-29
Abstract
The following paper investigates European policy about importing natural gas from Caspian Sea countries. The Nabucoo and Trans-Caspian gas project are the two potential projects. For these pipelines three countries are candidates: Iran, Turkmenistan and Azerbaijan. By using the game theory framework, ...
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The following paper investigates European policy about importing natural gas from Caspian Sea countries. The Nabucoo and Trans-Caspian gas project are the two potential projects. For these pipelines three countries are candidates: Iran, Turkmenistan and Azerbaijan. By using the game theory framework, coalition among natural gas exporters for the Nabucco Project has been considered. Iran, Turkmenistan and Azerbaijan are three potential exporter countries. In this paper we answer the question whether three countries should enter the coalition for exporting gas to Europe or not. Moreover, we accounted bargaining power of these countries. We conclude that all countries have profits to make the coalition for gas exporting in the Nabucoo project. Iran has more bargaining power than others so Iran can play an important and active role for exporting gas to Europe in the Nabucco project.
Farshad Moameni
Volume 1, Issue 1 , April 1995, , Pages 27-55
