Macroeconomics
Mohaddeseh Saberi; Zahra Afshari; Ahmad Sarlak; Seyed Fakhroddin Fakhr Hosseini; Esmaeil Safarzadeh
Abstract
In this paper, the effect of population aging on economic growth in a closed economy in which the element of human capital is endogenously formed is simulated. For this purpose the computable generalized Diamond overlapping generation’s model are used for a period of 50 years. First, the dynamic ...
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In this paper, the effect of population aging on economic growth in a closed economy in which the element of human capital is endogenously formed is simulated. For this purpose the computable generalized Diamond overlapping generation’s model are used for a period of 50 years. First, the dynamic effect of aging on macroeconomic variables, especially economic growth, are simulated in the baseline scenario (current state of the Iranian economy).Then the dynamic effects of public policies under different scenarios of human capital and pensions ratios on economic growth for a period of 50 years are simulated. The results of the model showed that the government's general policies to increase human capital increase the share of skilled labor (effective labor) and therefore have a growth effect. At values of public policy tools above the baseline scenario(industrial status), the effect of productivity on aging prevails and long-term growth increases.In addition, the results showed that increasing the ratio of pensions to the level of developed countries encourages demand-based economic growth, but has a level effect and does not change long-term growth. The results show that increasing aging, if combined with government policies to promote human capital, can potentially offset the negative impact of aging on growth.
Financial Economics
Hamid Reza Arbab; Hamid Amadeh; Amin Amini
Abstract
This study investigated the factors that leads to economic uncertainty which may influence the petrochemical companies returns in various market conditions regarding their various levels of capital. To meet this object, we used quarterly data on government’s current expenditures, general government ...
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This study investigated the factors that leads to economic uncertainty which may influence the petrochemical companies returns in various market conditions regarding their various levels of capital. To meet this object, we used quarterly data on government’s current expenditures, general government revenues, liquidity, GDP, and exchange rate, as the political variables for the years 1384-1397. Considering the type of available time series, we exercised the ARIMA-GARCH model to create an indicator to show the uncertainty of economic policies. We used the result to estimate the quantile regression model, along with other factors affecting corporate returns, including the price of the OPEC oil basket and the real rate of returns and market exchange rate. The results of this study indicated that in the bearish market, the greatest negative effect of each economic policy uncertainty is on the companies with lesser capital. Moreover, the intensity of this effect decreases as the market tends to change from bearish to bullish, and finally the economic policy uncertainty will have the least impact on companies with bigger capital.
Macroeconomics
Mohammad Ali Aboutorabi; Mehdi Hajamini; Sahar Tohidi
Abstract
In recent decades, the effect of financial development on real sector growth has been discussed from different aspects. This paper focuses on financial structure and explains the role of bank-based and market-based financial structures on economic growth by classifying the literature. Using the FMOLS ...
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In recent decades, the effect of financial development on real sector growth has been discussed from different aspects. This paper focuses on financial structure and explains the role of bank-based and market-based financial structures on economic growth by classifying the literature. Using the FMOLS method for the period 1979-2016, the effects of financial structure and banking structure on per capita GDP and sectors’ growth (agriculture, industry, and services) in Iran are estimated. Empirical findings indicate that discriminating policies and bias in financial structure in favor of a specific sector has a negative effect on real sector growth, especially agriculture and industry. Therefore, in support of the design of a balanced financial structure, it is recommended that the state should avoid any intervention or discrimination in favor of a specific sector. In the case of banking structure, the findings show that increasing the financial strength of banks encourages economic growth.
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.
Political economy
Salman Gharakhani; Mohsen Renani; Zahra Karimi
Abstract
One of the prevalent theoretical models for understanding the historical roots of the underdevelopment of various societies is the new institutionalist theory of institutional quality improvement which emphasizes the fundamental origins of economic growth. According to this theory, societies with inclusive ...
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One of the prevalent theoretical models for understanding the historical roots of the underdevelopment of various societies is the new institutionalist theory of institutional quality improvement which emphasizes the fundamental origins of economic growth. According to this theory, societies with inclusive institutions will experience a sustainable economic growth and development by creating a creative destruction process and a generative rent distribution while moving toward evolutionary cycles. Societies with extractive institutions, however, will lag behind and decline in the long run due to the dominance of rent relations and the non-generative rent distribution while moving toward vicious cycles. During the second Pahlavi period, despite its short-term experience of economic growth, Iran moved to vicious cycles instead of evolutionary ones; therefore, in order to investigate this issue, the reasons for the lack of sustainable economic growth during this period will be addressed using the theory of institutional quality improvement. To this end, one of the most important institutional barriers to economic growth in this period will be addressed through examining the process of creative destruction on the political and economic market. The results of this study indicate that despite experiencing the short-term economic growth achieved under the shadow of extractive institutions during this period due to factors such as power struggles, dominance of personal relations over affairs, the non-generative rent distribution etc., the process of creative destruction did not take shape on the political and economic market, so that despite the abundance of sources of income and foreign aid, Iran could not maintain its economic growth and development.
Growth Economy
Alireza Keshavarz; Zakariya Farajzadeh
Abstract
Natural capital has been introduced in growth models recently in order to address the growth differences among the countries. In this context, the objective of this study is to examine the role of introduced indices for natural capital in Iranian economic growth. To get the objective, Solow neoclassical ...
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Natural capital has been introduced in growth models recently in order to address the growth differences among the countries. In this context, the objective of this study is to examine the role of introduced indices for natural capital in Iranian economic growth. To get the objective, Solow neoclassical growth model using the data for 1980-2015 was applied. The applied indices include ecological footprint, biological capacity, ecological footprint-capacity difference, ecological tension, and agricultural land. The findings showed a significant fluctuation of the natural capital indices contribution to growth. Production elasticity with respect to ecological footprint found to be in the rage of 0.02-0.04 while the corresponding values for biological capacity and agricultural land tends to increase, ranging from 0.10 to 0.15. The corresponding values for physical capital fall into the range 0.12-0.17. In addition, the appropriateness of CES production function revealed the validity of constant returns to scale assumption in Iranian economy.
Mohammad Abdi Seyyedkolaee; Saleh Taheri Bazkhaneh
Abstract
The relationship between economic growth and inflation is one of the long-standing issues in macroeconomics, which is theoretically and politically confronted with many controversies. This is especially important for the Iran's economy, which seeks to achieve price stability and accelerate economic growth. ...
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The relationship between economic growth and inflation is one of the long-standing issues in macroeconomics, which is theoretically and politically confronted with many controversies. This is especially important for the Iran's economy, which seeks to achieve price stability and accelerate economic growth. In this regard, the present study has used continuous wavelet transformation to provide a new insight into the relationship between economic growth and inflation with time-frequency analysis in 1369:2–1397:2. The results show that in the long run (more than 4 years), an increase (decrease) in economic growth is accompanied by a decrease (increase) in inflation. In addition, the increase in economic growth has caused inflationary pressures in limited form and in short run (1380-1383). Therefore, it is recommended that policy makers focus more on economic growth in the long run.
Elham Kheirandish; Saeed Moshiri; Naser Khiabani; Ahmadreza Jalali-Naini
Abstract
Oil price shocks have direct and indirect impacts on the economies of oil-exporting and oil-importing countries. The direct impacts are through demand and supply channels and the indirect (spillover) impacts are through interaction between the countries. Most studies have focused on the direct effects ...
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Oil price shocks have direct and indirect impacts on the economies of oil-exporting and oil-importing countries. The direct impacts are through demand and supply channels and the indirect (spillover) impacts are through interaction between the countries. Most studies have focused on the direct effects of the oil price shocks in a specific country or a region and research works on indirect impacts are limited. In this research, the direct and indirect effects (spillover) of oil shocks on both groups of oil-exporting and oil-importing countries are estimated using a dynamic system model. The spillover effects are defined and measured by the “Trade Ratio” and “Weighted Average Economic Growth” indicators. The sample includes 30 oil-exporting and oil-importing countries with a share of 73 percent of the world’s economy. The results show that a positive oil price shock reduces economic growth in oil-importing countries and increases it in oil-exporting countries, but international trade between the oil- exporting and oil-importing countries mitigates the impact of oil shocks on economic growth of both groups.
Parviz Mohammadzadeh; Samaneh Khangaldizadeh; Shahram Kamangar
Abstract
Considering the role of creativity, innovation and entrepreneurship in economic growth and development, addressing these issues can be of particular importance. Particularly, the effect of these variables on economic growth is ambiguous and the need for empirical examination of this relationship seems ...
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Considering the role of creativity, innovation and entrepreneurship in economic growth and development, addressing these issues can be of particular importance. Particularly, the effect of these variables on economic growth is ambiguous and the need for empirical examination of this relationship seems to be necessary. Some studies, including Schumpeter (1947) and Roemer (1986), have highlighted the prominent role of entrepreneurship and innovation in the process of economic growth. The main purpose of this study is to investigate the effect of innovation (patent index) and entrepreneurship on the economic growth of selected countries, using GLS estimation method. For this purpose, data from 20 selected countries during the period 2001-2015 and the panel data approach have been used. The results of the model indicate that these two variables have a positive and significant effect on economic growth in the above countries ؛So that 1 percent increase in the rate of entrepreneurship and innovation (the number of patents registered) resulted in an increase of 13 and 4 percent, in the growth rate of these countries, respectively. Therefore, in the present study, creating an efficient innovation and entrepreneurship system is considered necessary to achieve appropriate economic growth.
Teimour Mohamadi; fatemeh azizkhani; hasan taee; Javid Bahrami
Abstract
The results of many studies show that rigid regulations on product and labor markets are considered as a key factor in weakening the employment conditions and have led to high unemployment rates. Given the complicated regulations in the countries of the Middle East and North Africa (MENA), studying the ...
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The results of many studies show that rigid regulations on product and labor markets are considered as a key factor in weakening the employment conditions and have led to high unemployment rates. Given the complicated regulations in the countries of the Middle East and North Africa (MENA), studying the great dynamics of deregulation can give useful guidelines for lawmakers and policy makers. The aim of this paper is to study the effect of deregulations of commodity and labor markets on the growth and the unemployment rate in 20 MENA countries using GMM method and Panel VAR approach during the period 2005 – 2017. The results of this study show that deregulation in product and labor markets in the short run will reduce economic growth, increase unemployment and lead to recession. But in the long run, it will increase economic growth and reduce unemployment. The labor market reforms, as opposed to product market reforms, do not lead to major dynamics in economic growth. For policy-making in MENA countries, deregulation in the product market has priority over the labor market, since it has a stronger impact on the wavelength and durability of the effects.
Hajar Mozafari Shamsi; Sara Ghobadi
Abstract
One of pleasant subjects for economists, in the field of Macro-political economy, is investigating the impact of relevant factors on financial corruption. This study aims to investigate the effect of economic and political factors on financial corruption, economic growth, and the size of government as ...
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One of pleasant subjects for economists, in the field of Macro-political economy, is investigating the impact of relevant factors on financial corruption. This study aims to investigate the effect of economic and political factors on financial corruption, economic growth, and the size of government as well as their interaction effects in the selected oil producing countries over the 2003-2014 period. To estimate the model, system panel data approach is applied based on Generalized Method of Moments (GMM) estimator. The results showed that an improvement in the economic growth, size of government, democracy, rule of law and access to sound money variables decrease financialcorruption of selected oil producing countries. Also, improving the size of government, political stability, democracy, business regulations variables and decreasing financial corruption has led to economic growth of the selected countries. Finally, improving economic growth, increasing oil revenues and urbanization has increased the size of government in these countries.
Zahra Kashanian; hosein raghfar; Mir Hossein Mousavi
Abstract
Population aging was one of the most important concerns of the last century all over the world. In this study, in order to investigate the effect of demographic changes on some macroeconomic variables, Diamond two-stage overlapping generation model (OLG model) is applied. In this model, we consider an ...
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Population aging was one of the most important concerns of the last century all over the world. In this study, in order to investigate the effect of demographic changes on some macroeconomic variables, Diamond two-stage overlapping generation model (OLG model) is applied. In this model, we consider an economy inhabited by two-period lived overlapping generations, the length of each period is considered thirty years. From the life cycle perspective, the first period represents working period and the second one is considered as the retirement period. This model consists of three sectors: household, government and production which operate in a competitive market. Simulations indicate that 6 components affect the economic growth: labor supply, savings rate, capital deepening and public investment have positive effects and elder labor supply and tax have negative effects on growth. The component of capital deepening and public investment respectively has the strongest impact on economic growth. The model has some predictions based on the replacement of endogenous growth with exogenous growth. Predictions about endogenous and exogenous growth shows the replacement has negligible impact on the results.
Saleh Ghavidel; Nasim Mirghiyasi
Abstract
In this paper, the impact of population aging on economic growth is estimated regarding the population growth factor and life expectancy index. For this purpose, the methods of differentiation, averaging and virtual variables have been utilized through the compilation of the data gathered from 146 countries ...
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In this paper, the impact of population aging on economic growth is estimated regarding the population growth factor and life expectancy index. For this purpose, the methods of differentiation, averaging and virtual variables have been utilized through the compilation of the data gathered from 146 countries during 1990-2013 aimed at controlling the unobservable factors. The results demonstrate that the negative impact of population aging on economic growth appears in countries wherein the life expectancy index is above 70 whereas in countries with a life expectancy of less than 70 years the impact of population aging on economic growth is not negative. Furthermore, the results of this research show that the population growth rate has a positive effect on economic growth only when the population above 65 years old accounts for at least 18% and a maximum of 21% of the total population. In countries wherein the population over 65 exceeds the above-mentioned percentage, the positive effect of population growth on economic growth is undermined.
Navid Kargardehbidi; Effat Ghorbanian; Fatemeh Fathi
Abstract
Given the existence of a mutual relationship between human health and economic growth in societies, determining factors influencing human health can be effective in formulating executive policies and plans. The present study is designed to assess the effects of economic growth, government consumption ...
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Given the existence of a mutual relationship between human health and economic growth in societies, determining factors influencing human health can be effective in formulating executive policies and plans. The present study is designed to assess the effects of economic growth, government consumption expenditures and age dependency rate on health expenditures in Islamic countries of D-8 group during 1997-2014. Regarding the results of stationary tests, a new approach to panel econometric data -Panel Auto-regressive Distribution Lag (Panel ARDL) -was used to study the long-run and short-run relationship. Health goods and services for D-8 countries are considered as luxury and essential goods in the long-term and short-term. Also, two indicators of age old dependency ratio and young age dependency ratio, have a positive and negative impact on per capita health expenditure, respectively.
Hosein Mohammadi; Morteza Mohammadi; Parisa Alizadeh
Abstract
Achieving a higher rate of economic growth is one of the main goals of each country that policymakers often pay special attention to it. Therefore, investigating the causes of economic growth is important. Import tariffs as one of the most important factors affecting economic growth have been neglected ...
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Achieving a higher rate of economic growth is one of the main goals of each country that policymakers often pay special attention to it. Therefore, investigating the causes of economic growth is important. Import tariffs as one of the most important factors affecting economic growth have been neglected in many previous studies. Therefore, the aim of this study is examining factors affecting economic growth in ECO countries with an emphasis on the role of import tariffs during the period 1996-2014. The results of dynamic panel data using PMG estimator show that the effect of import tariffs on economic growth in the short and long run is negative and significant. In addition, the effect of trade liberalization on economic growth in the short run is positive and significant. Therefore, by reducing import tariffs and moving toward more trade liberalization, economic growth in ECO countries increases. Furthermore, the labor force had a negative effect and human capital had a positive effect on the economic growth. Finally, results showed that physical capital had the most effect on economic growth in this group of countries. Therefore, improving the business environment, encouraging private investment, moving toward more competition in economic activities with trade liberalization, and moving toward more economic transparency are some recommendations of the current study.
Esfandiyar Jahangard
Abstract
The Iranian economy suffers from low economic growth despite having access to enormous reserves of natural resources. The role of investment rate as the driving force of economic growth has been the focus of much debate among macroeconomists. This raises an important question: Why does growth in Iran ...
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The Iranian economy suffers from low economic growth despite having access to enormous reserves of natural resources. The role of investment rate as the driving force of economic growth has been the focus of much debate among macroeconomists. This raises an important question: Why does growth in Iran remain low despite of high investment? One way to answer this question is to look at the relationship between economic structures and performances. Contributing to the literature in the field, we incorporate intermediate goods in our calculation of inter sectoral resource allocation for the purposes of production analysis over the period of 1973-2011. Five national input-output tables for the years of 1973, 1986, 1991, 2001 and 2011 consisting of 19 sectors in current prices have been used in this study. The results showed that the average production multiplier is 1.8. The overall findings revealed that the structural transformation has shifted from agriculture to some industries and service sectors which differs from the experiences of developing and developed countries.
Hossein Marzban; Ali Hossein Ostadzad
Abstract
Ongoing sanctions on Iranian economy have proved to be very harmful and detrimental to Iranian economic affairs and social welfare. Evaluating the unfair impacts of these sanctions on Gross Domestic Product (GDP) and social welfare is the aim of this paper. Firstly, we have developed a generalized growth ...
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Ongoing sanctions on Iranian economy have proved to be very harmful and detrimental to Iranian economic affairs and social welfare. Evaluating the unfair impacts of these sanctions on Gross Domestic Product (GDP) and social welfare is the aim of this paper. Firstly, we have developed a generalized growth model in the presence of sanctions while treating exchange rate as a random variable. Secondly, three different forms of sanctions are introduced into the model and their bearings on national product and social welfare is studied. The first tier of the sanctions is imposed on consumption, intermediary and capital goods while exchange rate is assumed to have a random behavior. Then sanctions are also imposed on Iranian oil and gas production. We have devised several scenarios using stochastic Hamilton Bellman Jacobian value function (SHBJ) and genetic algorithm optimization methods. Our results of the first and second scenario imply that the level of social welfare is mostly affected by oil and gas sanctions while goods embargo has targeted goods production. The effects of sanctions on GDP and social welfare is represented by a concave curve. This curvature shows that the impact of sanctions on GDP and social welfare is stronger at the beginning than later on when further sanctions are introduced. In the third scenario oil, gas and goods sanctions are imposed simultaneously. Our results also show that the third scenario effects is stronger than the other two. According to the Gross Domestic Product data acquired for year 1390, oil and gas sanctions have lowered the GDP by 30 percent, while the overall reduction in GDP through all sanction collectively is estimated between 30 to 50 Percent.
Seyed Saleh Akbar Mousavi; Jafar Haghighat; Mohammdreza Salmani Bishak
Abstract
Recent technological advances have increased the importance of human capital over the past years. In this paper, we study the impact of human capital on economic growth in Iran using the nonlinear STR method for the period 1345-1389. To this end, we estimate a two regime Logistic Smooth Transition Dynamic ...
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Recent technological advances have increased the importance of human capital over the past years. In this paper, we study the impact of human capital on economic growth in Iran using the nonlinear STR method for the period 1345-1389. To this end, we estimate a two regime Logistic Smooth Transition Dynamic Regression (LSTR) model in which the transition variable is the logarithmic change in human capital. The results show that the impact of human capital on growth is different in two regimes. In the first regime, if the human capital growth rate is below the threshold value, the effects of human and physical capital on economic growth will be negative and positive, respectively. In the second one, human capital has positive and significant impact on economic growth. The main conclusion of the study is that it is crucial to take the type of regime into account.
Seyed-nezamuddin Makiyan; Mohammad Reza Izadi
Abstract
Among the important factors that affect on economic growth such as physical and human capital, openness of economy etc., the role of financial intermediaries on economic growth has been overlooked. This research aims to investigate the role of financial structure and development as the indices of financial ...
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Among the important factors that affect on economic growth such as physical and human capital, openness of economy etc., the role of financial intermediaries on economic growth has been overlooked. This research aims to investigate the role of financial structure and development as the indices of financial system development on economic growth. To this end, the study uses a regression analysis applying FMOLS method for the period of 1989 to 2011 for the selected Islamic countries. The results indicate that variables of financial structure and financial development have significant positive effects on economic growth. According to the findings, financial system based on market approach is more effective concerning the economic growth. Furthermore, the Granger Causality test indicates that there is a one-way causal relation between development of financial system and economic growth in the short run; however, this relationship has a two-way direction in the long run confirming the Patrick’s viewpoint of development.
Yeganeh Mousavi Jahromi; Farhad Khodadad Kashi; Alame Moosapour Ahmadi
Volume 19, Issue 61 , February 2015, , Pages 117-147
Abstract
In the presentstudy,the evaluation of different economic factors’ impact on income inequality in Iran has been considered during the period 1363-1390. In order to achieve this, Auto-Regressive Distributed Lag method is used. The results indicate that the rate ofeconomic growth and inflation rate ...
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In the presentstudy,the evaluation of different economic factors’ impact on income inequality in Iran has been considered during the period 1363-1390. In order to achieve this, Auto-Regressive Distributed Lag method is used. The results indicate that the rate ofeconomic growth and inflation rate havenegative influence and income tax, labour productivity and gas and oil revenue has a positive influence on income equality.Also based on the results, it can be stated that the relationship between economic growth and income distribution confims Kuznets and Kaldor’s view. The structural stability tests indicate the estimated model is stable. In addition, according to calculated elasticities, it can be concluded that revenue fromincome tax has had the most effect on reducing incomeinequality in Iran during the mentioned period.
Hosein Mohammadi; Mahboubeh Narouei
Volume 19, Issue 61 , February 2015, , Pages 149-171
Abstract
Many economists insist that the financial market is a key factor in economic growth due to the role of financial markets in financing and capital formation in different countries. With the development of endogenous growth models in recent decades, researchers pay more attention to the relation between ...
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Many economists insist that the financial market is a key factor in economic growth due to the role of financial markets in financing and capital formation in different countries. With the development of endogenous growth models in recent decades, researchers pay more attention to the relation between financial markets and economic growth. In this study, the empirical relationship between Foreign Direct Investment in dealing with financial development on economic growth investigated in 25 Islamic countries over the period 1990 to 2012 using Generalized Method of Moments (GMM). The results show that the interaction between foreign direct investment and market-based indicators of financial development causes economic growth.
Ali Saedvandi; Hossein Sadeghi; Zahra Keshavarzi
Volume 18, Issue 56 , October 2013, , Pages 95-122
Abstract
Although depreciation is a crucial factor in economic growth models, little effort has been made to estimate depreciation rates. In this study, we attempt to estimate integrated fuzzy indicators for depreciation rates in 21 comparable developing countries. In the framework of fuzzy logic, first, we combine ...
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Although depreciation is a crucial factor in economic growth models, little effort has been made to estimate depreciation rates. In this study, we attempt to estimate integrated fuzzy indicators for depreciation rates in 21 comparable developing countries. In the framework of fuzzy logic, first, we combine ten related variables to obtain four depreciation indicators, namely human, social, physical, and natural capital. Then the four indicators are combined to obtain an overall depreciation rate. The results indicate that remarkable gap exists among developing countries. The overall depreciation rates are at the highest level in the CIS countries (circa 0/7) and at the lowest level in some of the developing European nations (circa 0/4). Due to lack of information, the exact estimation of a combined depreciation indicator seems impossible for Iran; nevertheless, we estimate a minimum boundary for this country, which indicates the dismal situation of capital preservation in Iran.
Behzad Alipour; Mehdi Pedram; Iman Charghanian
Volume 18, Issue 54 , April 2013, , Pages 27-53
Abstract
We analyse short-run and long-run effects of government size on the economic growth of Iran ,using 1353-90 time series .the results of estimation , by using of ARDL and boundaries testing approach, indicate convergence of the dynamic model to the long-run trend. The error correction model also ...
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We analyse short-run and long-run effects of government size on the economic growth of Iran ,using 1353-90 time series .the results of estimation , by using of ARDL and boundaries testing approach, indicate convergence of the dynamic model to the long-run trend. The error correction model also show that 59 present of departure from the long-run trend will be corrected in every period. The long-run estimation shows a positive relation between oil price, oil revenues and ratio of investment to the real GDP as independent variables and economic growth as dependent variable, and a negative relation between government size and a dummy variable for war and revolution as independent variables and economic growth.
Amir Khademalizadeh
Volume 18, Issue 54 , April 2013, , Pages 93-118
Abstract
New generation of growth models considers the effects of financial development on economic growth. The new financial literature takes a micro approach with emphasis on the external finance. In this research we examine the empirical relationship between capital market and economic growth, encompassing ...
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New generation of growth models considers the effects of financial development on economic growth. The new financial literature takes a micro approach with emphasis on the external finance. In this research we examine the empirical relationship between capital market and economic growth, encompassing 27 superior firms of Tehran Stock Exchange during 1380-1390, which may being considered as a financial investigation in Iran’s Capital Market at the firm level.
This paper is organized to examine the hypothesis that the external finance increases the sales and output growth rate of firms in Tehran Exchange, and therefore the aggregate economic growth. The results obtained in this paper through generalized method of moments (GMM) analysis indicate that financing both banks and capital market respectively, has increased sales and growth rate to 65.3 and 53.8 in our sample. Furthermore the sales growth rate of 27 firms that used external finance has a positive and significant relation with net sales ratio to fixed assets which indicate the positive role of capital market on economic growth in Iran. The Policy recommendation of this research is developing the capital market through definition and introduction of new financial instruments in order to absorb liquidity for efficient firms in Iran’s Capital Market.
Zahra Azizi; Morteza Khorsandi
Volume 17, Issue 53 , February 2013, , Pages 85-100
Abstract
In recent years, several studies have examined the relationship between financial development and economic growth. But even considering the same Indicators of financial development, findings of these studies have been different. The existence of non-linear relationships can be one of the reasons for ...
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In recent years, several studies have examined the relationship between financial development and economic growth. But even considering the same Indicators of financial development, findings of these studies have been different. The existence of non-linear relationships can be one of the reasons for these differences. In this paper using the smooth transition regression method, we examine a nonlinear relationship between financial development and economic growth in Iran. The tests of linearity, transition variable election and transition function determination results confirms the existence of non-linear relationship between financial development and economic growth by considering time trend as a transition variable. The appropriate transition function is LSTR1 that is a logistic function form with one threshold. As a result a regime change in the relationship between financial development and economic growth occurred in about 1989, ( i.e. at the end of the war ). This regime switching can also be considered as a cause for difference in findings of similar studies in Iran.
