Iranian Journal of Economic Research

Abstract The possible WTO membership of Iran not only depends on liberalizing the trade sector but also needs to meet the relevant conditions of a specific development process. To examine these conditions we specify an unconstrained first-order autoregressive model of the Almost Ideal Demand System(AIDS), as a long-run demand model, for Iran’s import allocation over foreign and domestic supplies of manufacturer.    In this paper, the structural stability of the AIDS model is tested by using time series data for the period 1993-2002. The significance of trade liberalization, proxied by a dummy variable over the period reveals both trade creation and trade diversion in the Iran’s imports    In addition, the conduction of different scenarios on reducing tariff, arising from the Iran’s fourth development program, over the ex-ante period 2003-2007 indicates that there is no structure break in the country’s import demand. The implication of this result is that a decrease in tariff through a relatively accelerated speed of adjustment can be utilized for the promotion of trade between Iran and her trading partners.

Abstract The purpose of this paper is to answer the following question: Is estimate the price and income elasticites of the demand for health services in Iran elastic?.     This researchWe use  has used the Almost Ideal Demand System (AIDS) model. AIDS model using the household expenditure data  for the three subsections of medicine, user fees for doctors' and  fees and hospitals ization services for three income groups for thein the period 1971 – 2001.   One conclusion isOur results indicate that, the health services should be considered as aare necessity for all income groups. In this case, cross elasticities showed  and that hygiene and/or mMedical services have complimentary relations with cloths and shelter.    Price elasticitiesy of hospitalization for low, medium, and high income groups was are low: -0.52, -0.53 and -0.62, respectively. These results indicate of low elasticity of hospitalization services for all income groups and this issue Overall, we conclude that the confirms that elasticity for health services is low in Iran.

Abstract This paper tends to estimate the long-run import budget share, arising from various supplying resources for Iran. The formulation is based upon typical model of the Almost Ideal Demand System (AIDS).
    After estimating import demand, we test the hypothesizes that import demand is homothetic, homogenous and symmetric. Using the dynamic adjustment process of the first order of Error Correction Model (ECM), the paper estimates the long-run balanced import budget shares, domestic sales share as well as long-run expenditure and compensated price elasticites over the 1978-2002 period. Estimation results obtained indicate that implementing trade liberalization policy can possibly lead the share of domestic sales to decline, while total import budget share to grow resulting in trade expansion, and particularly, trade flows to be deviate from other partners to Iran’s second ten major trading partners.

Abstract The main purpose of this paper is to critically review the studies applied the AIDS model to study of the Iranian demand for different goods and services. The survey finds that the results obtained by these studies are not reliable. These studies use the unsuitable linear approximation index, inappropriate estimation methods and computation formula for estimating own-price elasticity. Addressing those problems, we analyze the consumer behavior using the demand system in the rural and urban areas of the Kohkilouye - and – Bouyerahmad province of Iran.