Hamidreza Horry; Seyyed Abdolmajid Jalae; Maryam Lashkari
Abstract
In any society, government officials and policymakers must take well-being into consideration as it is one of the main indicators of development and also a key element of social growth and development. Evaluating economic well-being during successive, inevitable periods of boom and recession helps evaluating ...
Read More
In any society, government officials and policymakers must take well-being into consideration as it is one of the main indicators of development and also a key element of social growth and development. Evaluating economic well-being during successive, inevitable periods of boom and recession helps evaluating the effectiveness and efficiency of policies and aids economic policymakers in making better decisions. This study aimed to investigate the effects of business cycles on economic well-being index in Iran for the 1980-2016 period. To measure well-being, the Osberg index of economic well-being was used and each component fit was assigned a weight using the Delphi method. Then, in a model suited for Iranian economy, the impact of business cycles was estimated using a gravitational search algorithm. The findings of the Delphi method indicate that economic security component has the highest weight among the four components of this index. Model evaluation revealed that business cycles are directly related to the economic well-being index, indicating that the boom and recession periods of business cycles have respectively led to the improvement and decline of economic well-being index in Iran.
Siab Mamipour; Soghra Jafari; Ziba Sasanian Asl
Abstract
The main purpose of this paper is to investigate the effects of monetary and fiscal policies on the business cycles in the Iranian economy during the period 2004-2016. Markov Switching model has been used with time varying transitional probabilities for the recognition of the business cycle and identifying ...
Read More
The main purpose of this paper is to investigate the effects of monetary and fiscal policies on the business cycles in the Iranian economy during the period 2004-2016. Markov Switching model has been used with time varying transitional probabilities for the recognition of the business cycle and identifying the influencing factors on the probability of staying in a period of recession and boom or the transition from one situation to another. The results of the MSIH(2)-AR(2)[1] model show that both expansionary monetary and fiscal policies increase expansion period, but expansionary monetary policy is more effective in expansionary fiscal policy. During the recession regime, fiscal policy has a greater impact than a monetary policy in the transition from the recession regime. Also, findings show that business cycles in Iranian economy have comovements with changes of oil revenues, but the effect of changes in oil revenues has a different effect on the staying or transition of business cycles. Thus, the increase of oil revenues reduces the probability of staying economic boom regime, but it will increase the transition probability of recession to boom regime. In fact, these results indicate that oil revenues are not managed well during the boom period but there is the relatively good management in the recession regime. [1]- Markov Switching Intercept and Heteroskedasticity terms (2 regimes)-AutoRegressive (2 Lags)
