Iranian Journal of Economic Research

Abstract This articles aims at evaluating the effects of selectivity and endogeneity problems on returns to education caused by individuals' decision to attend school and to participate in the labour market. We apply conditional regression models (earnings functions) to tackle the problem of selection bias and use instrumental variable technique to take into account the problem of endogeneity. Using data from the Tehran province survey of socio-economic characteristics 1380 and the U.S. current population census 1991, we found that (1) return to education is positive and substantial, (2) taking into account the problems of selection and endogeneity increases the returns to education estimates, and (3) the findings of Tehran province sample are similar to those of the U.S. sample. Therefore, the pattern of findings are the same and also consistent with theoretical considerations stating that the conventional estimates which do not deal with the problems of selection and endogeneity produce biased and inconsistent results. 

Abstract The purpose of this paper is to estimate and study industry specific determinants of Iran’s intra industry trade (IIT) types. To this end, we use the data on foreign trade and industry specific for 16305 Iranian manufacturing firms in 2002 at the 4-digit aggregation level of ISIC classification. Results imply that dominant market structure in intra industry trade types of Iranian manufacturing industry is an imperfect competition. Specifically, economies of scale, low concentration and product differentiation are important determinants of Iran’s manufacturing industry IIT types. Furthermore, the research and development expenditures and foreign direct investment have significant and positive effects on Iran’s IIT.  Industry specific characteristics such as economies of scale and product differentiation, R&D and FDI are important factors in promoting IIT in Iran.

Abstract The Environmental Kuznets Curve (EKC) is an empirical inverted U-shaped relationship between pollution and income. In the early stages of economic growth, pollution increases but beyond some level of income per capita the trend reverses. In this paper, we examine the validity of EKC for a sample of 13 Middle East countries. Sample period include 1998-2003. A large number of EKC studies focus only on developed countries or a sample of developed and developing countries but for the first time our sample consist solely of emissions from Middle Eastern countries. We have used CO₂ as the main  pollutant factor in this study. Our log-log specification results suggest a monotonic and increasing relationship between income and pollution, but regression coefficients are not statistically significant. However, in our linear model all the coefficients are statistically significant and the EKC hypothesis can not be rejected.  

Abstract Urbanization occurs when sector composition changes from agriculture to industry. Technology improvement in agriculture releases labor from this section and causes labor to immigrate from rural areas to urban areas. Population movements from rural to urban areas change spatial shape of a country. This change will lead to the growth of existing cities, creating new cities, and/or both. This urban development has two sides: growth  in number of cities and growth in sizes of cities. This study considers only the growth in number of cities. This paper tests the impact of economic factors on urban development through traditional and spatial specification of Henderson’s models for Iran’s urban system in 1966-96. The results show that considered factors has affected the growth of number of cities in Iran, although there has not been significant spatial dependence.

Abstract The impact of globalization on income distribution is one of the most important issues among economists regardless of their views on globalization. In this study we investigate the impact of globalization on income distribution in Iran using the data for the period 1968-2004 and Johanson - Joselius co-integration method.  We use the index of trade intensive (the ratio of the sum of export and import to GDP) as a globalization measurement standard. The rate of inflation and unemployment, government public expenditure and per capita income as other effective variables on income distribution.The results of estimation confirms the Kuznets hypothesis in Iranian economy, and the rate of inflation and unemployment have direct relationship with income inequality. The ratio of government public expenditure to GDP has direct relationship with the improvement of income distribution, and globalization would increase income inequality..   

Abstract The purpose of this paper is twofold. The first aim is to illustrate the relationship between game theory and linear programming. The other aim is to apply game theory to field crops. We have used the main field crops (wheat, barley, paddy, maize, chickpea, lentil ,cotton and potato) in Province of Fars. The data included time series of gross product values of the investigated crops for the period 1362-1382. The Wald decision-making criterion was applied to the game theory model to determine the highest income under the worst conditions. The results of the model indicate that potato and paddy were the most risky crops for the the period of study. As potato and paddy provide the highest expected income under the worst conditions these crops enter the optimum plan. Furthermore, these two crops have the highest variation coefficients compared to the other crops.  It is concluded that the game theory model can be used to select alternative management strategies.

Abstract Iran imports more than one third of its sugar consumption. In this paper, we test for market power in the Iranian sugar imports market using NewEmpirical Industrial Organization (NEIO) theory.  We use the data for the Iranian sugar market for the period 1974-2004 to estimate the degree of the market power. Our results indicate that market power parameter in the Iran sugar imports market is 0.004. This reveales that the sugar imports market for Iran is competitive, and the behavior of price determination in this market is much closer to price taker than collusion.

Abstract The aim of this study is to investigate the rates of supports for wheat and rice producers and consumers including input support, price support and aggregate domestic support of these products at the end years of three recent development programs (1993, 1999 and 2003). Required data were collected from Production Cost Collection of agricultural commodities, Iranian Foreign Trade Statistics Yearbooks, Iranian Central Bank and other  statistical databases. Results show that the rates of supports for wheat and rice are high and therefore a portion of producers' income and consumers' expenditures are contributed to protection policies. In all studied years, consumers support exceeded from those of producers and considering the low level of price supports, total supports are recognized to be almost equal to input supports for these two products.

Abstract It is argued that economic regulation of prices and conditions of public utilities improves efficiency and the quality of services. A Regulatory reform requires a regulatory body in place to set the rule of the game and to monitor the behavior of the firms engaged in the reform. The regulator's main task is to calculate the optimal prices and the level of cost-reducing effort for the firm and to instruct the firms to implement this solution. It is assumed that the result would furnish an environment in which competition will be flourished and accordingly efficiency and the quality of services will be improved. This study investigates regulatory reform in Iranian Electricity Distribution Industry (IEDI) and its impact on efficiency. To this end, efficiency in IEDI is estimated using DEA method and Malemquist index. Finally, price caps in EDI are calculated.