Research Paper
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.
Research Paper
Economic Development
Behrooz Shahmoradi; Mojgan Samandar Ali Eshtehardi
Abstract
Economic complexity is a concept that is used to express the ability of countries to produce complex products through the proper construction of technology structures in order to collect its diverse technologies and apply them. In this article, by using economic complexity approach, we aimed to identify ...
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Economic complexity is a concept that is used to express the ability of countries to produce complex products through the proper construction of technology structures in order to collect its diverse technologies and apply them. In this article, by using economic complexity approach, we aimed to identify the products in Iran’s technological capabilities frontier that leads the country to produce more diverse and complex products. For this purpose, by using four-digit SITC classification data, 86 products were identified. By producing and exporting them, the country can reach a higher accumulation of technological capabilities and thus a higher degree of diversification and economic complexity. Also, according to three criteria, the total number of competitors, the volume of world trade and the number of importing countries from selected products, 16 products in the world and 11 products in the region were picked up as the products in priority.
Research Paper
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.
Research Paper
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.
Research Paper
Macroeconomics
Narges Hajimoladarvish; Neda Mozaffaripour
Abstract
Replacement of labourers by robots and automation has been one of the oldest concerns in the labour market, and many people have attributed rising unemployment to the growth of innovation and technology. Some researchers have linked the impact of technology on employment to breadth and depth of markets. ...
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Replacement of labourers by robots and automation has been one of the oldest concerns in the labour market, and many people have attributed rising unemployment to the growth of innovation and technology. Some researchers have linked the impact of technology on employment to breadth and depth of markets. Available evidence suggests that the impact of innovation and technology on employment depends on the international competitiveness of countries and the quality of their workforce. Since the economic complexity index measures both exports and the level of available knowledge in economies, it can be a good candidate for considering the breadth and depth of markets. The present study examines the effect of economic complexity on unemployment by controlling for GDP and inflation and asks whether there is a level of innovation determining the relationship between the economic complexity and unemployment. For this purpose, we use a panel threshold regression for a period 2008- 2017. Findings show that the relationship between economic complexity and unemployment is non-linear. Moreover, there is the evidence of substitution of labour by robots when the innovation index is in the range of [0.456, 0.493).
Research Paper
International economy
Samira Motaghi; Anahita Saifi; Salah Ebrahimi
Abstract
The aim of this paper was to investigate the relationship between trade openness and inflation in selected developing and developed countries from 1990 to 2017 using a Panel data approach for testing Romer's hypothesis of relationship between inflation index and Trade Openness. The results of the paper ...
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The aim of this paper was to investigate the relationship between trade openness and inflation in selected developing and developed countries from 1990 to 2017 using a Panel data approach for testing Romer's hypothesis of relationship between inflation index and Trade Openness. The results of the paper show that the Romer hypothesis is rejected in both the studied groups (developed and developing). The results showed that the effect of trade openness on inflation rate was positive and significant in both groups. But the impact of trade openness on inflation has been greater in developing countries. The effect of money supply on inflation was positive and significant in both groups. According to other results of this study, GDP had a significant and negative effect on inflation. Also, the exchange rate has not been a determinant of inflation in developed countries but in developing countries it has had a positive effect on inflation.
Research Paper
Monetary economy
Abolfazl Shahabadi; Razieh Davarikish; Mahdi Jafari
Abstract
The significant difference between the growth rate of liquidity and the rate of economic growth creates a kind of inflationary potential in the economy. Part of this difference occurs as overt inflation, but the other part will remain latently as potential inflation in the economy. Potential inflation ...
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The significant difference between the growth rate of liquidity and the rate of economic growth creates a kind of inflationary potential in the economy. Part of this difference occurs as overt inflation, but the other part will remain latently as potential inflation in the economy. Potential inflation should have appeared in the economy but was delayed, and this could cause inflation shock and inflationary uncertainty in the country's economy. Therefore, potential inflation is one of the main problems of any country that the fear of bursting and its occurrence causes instability and economic turmoil. The uncertainty resulted leads to huge bewilderment of investors and to reduced investment and employment. Residual factor and institutional quality is one of the factors affecting potential inflation. Because, with the improvement of the Residual factor, the appropriate institutional quality and the high rule of law and order, the concerns related to the growth of liquidity are eliminated. In this case, the growth of liquidity is commensurate with the economic growth and more growth in liquidity than economic growth is prevented. The purpose of this study is to investigate the effect of residual factor and institutional quality on the potential inflation of selected countries rich in natural resources for the period 1996-2019 using the fully modified ordinary least squares (FMOLS) method. The results of this study indicate that the variables of residual factor, institutional quality and exchange rate have a negative and significant effect on potential inflation. Also, according to the research results, the variable of government spending has a positive and significant effect on potential inflation.
