Journal of Economic Research
Year:2006 | Volume:- | Issue:73|Papers Count:14

In this study we assess the effects of financial development on private saving in Iran. As capital accumulation is the most important factor in economic growth, therefore the evaluation of effects of developments in financial system on saving (that is recently going to join to' global economy based on liberalization principles) is seemed very important. After identifying of financial system in Iran and determination of effective variables on private saving, using a statistical method, named principle components, we made a financial sector development index. The most important results which were achieved are: a) in the last three decades Iran's financial sector has been very small. b) Development of financial system (constrained with quantitative banking indices) has had a negative effect on saving in Iran.    

Private sector investment is fundamental in economic development. Here, we are trying to show which factor is more important. This study was written with focus on the theories of investment and investment process in Iran. A lot of work has done in this area in Iran, but they did not pay attention much to the non-economic factor which affects on investment. We have analyzed the theories that define influence of qualitative variables on investment. These variables cause uncertainty for economy, so we studied the impact of them with attention to a specific situation. In the last chapter we used qualitative variables in an econometric model. Our concern was finding the reasons of existence of these types of variables. And then we focused on them. At the end of our paper we have suggested some policy implication.    

In this paper we try to determine the set of factors which affect on foreign direct investment flow and to show the conditions in attracting FDI in Iran. While the major factors are determined, we try to estimate and measure the significant of the important factors that effect on FDI inflow to Iran by using the Bajio-Simon model (1996) and ARDL method during the period of 1353-1380. The three set of result show that during the period of study both in short run and long run, inflation rate that in general implies the ineffectiveness of economic policy has negative impact in absorbing FDI, Further more, increasing in GDP, capital stock and degree of openness in economy that means the reduction of tariff barriers in the country, have the positive effects on FDI flow to Iran. Also increase in interest rate and exchange rate will have a negative effect on FDI flow to the country. The result of survey also shows that the wage level doesn't have any effect on FDI inflow. Moreover, the result of dynamic model confirms the long run relationship between explanatory variables and FDI. The ECM model also implies that any shocks imposed to each of independent variables of the model may continue to 2.5-3 years are need for FDI to return to its long -term trend.    

The first social, cultural and economic development plan in Islamic Republic of Iran (1368) is based on adjustment and reform structure. An increase of economic capacity, investment, economic growth and changes in protection policies were important goals of this plan. Therefore, privatization, decreasing the role of the state, price adjustment of goods and services, exchange rate adjustment and providing basis for competitive market, reducing subsides, export expansion and international trade liberalization were designed and followed in second and third plan. Nowadays Iran's labor market has faced with disequilibrium crises. The population explosion of early revolution period (1358-62) and consequently the increase in labor market supply relative to employment opportunities in recent years resulted in employment problems and misery of labor class. In this research it is tried to find out the effectiveness of macroeconomic policies, derived from the dominant view of free market economy on Iran's employment opportunities. It is argued that, although policy makers emphasized on free market theoretically, practically we have witnessed government interventions and increase in labor market regulations in different five-years plans (legal articles of 48 to 56, third development plan, shows this idea on the experimental part). Neoclassic model, which is implemented with reduced form and stimulate equations in VAR, shows a significant effect of ECM with low speed of the short run equilibrium compared with the long run. The IRFs results illustrate that, by a shock in employment, supply of labor and wages have insignificant effects on employment, too. However, VDCs shows that the employment is the most important effective variables of employment fluctuations in the short run. But for the long run, the results indicate that the shares of effects of wage on employment, and labor and employment on employment fluctuations are 6%, 30% and 66%, respectively. In addition, the Dummy Variable of structural adjustment has positive and significant effect on employment. Therefore, from the start of the first five-years plan (1368) up to now different planning theoretically were based on free market economy while in practice, policies and programs were dominated by government interventions and state regulations.    

The energy carriers (e.g. electricity) have a prominent role in the sustainable economic development. Among energy carriers, electricity has an essential role because of not having substitute in many cases as well as its ongoing expansion in the different stages of economic development. This research will investigate the functional relationship of electricity demand by using the co-integration techniques especially ARDL method and Error Correction Mechanism (ECM). The quality of electricity supply (by using frequency shortage data) is included in the model. The frequency shortage data is used since it has been considered as an index for low quality of supply in the industrial sector. The results indicate that the long-run industrial electricity demand can not be considered as a function of electricity price. In addition, the estimated price and income elasticities in the short-and long-run prove that electricity is an inelastic input. Cross-price elasticities indicate that electricity and natural gas are substitutes in the short-run. Further more, the quality of electricity supply in the model is a significant variable which indicates its impact on the level of industrial electricity demand in Iran.    

The main purpose in this article has been to estimate an Early Warning Model for OPEC countries, using the Signaling and Probability methods with annual data during 1989-2004.Using the Signaling method, growth rate of trade balance, international reserve growth rate, ratio of M2 over International reserve growth rate, ratio of Government debt to Central bank over total credit of Central Bank, Ratio of internal credits to GDP, ratio of M2 over international reserve, export growth rate, bank deposits growth rate, ratio of foreign liabilities over foreign assets, ratio of domestic credit over total bank deposits, and growth rate of domestic credit over GDP, are found to be the most crisis predictor variables within OPEC that monitoring these variables can help to recognize monetary crises. Applying the Probability method, a probability function is developed, that has predicted at least 40 percent of 76% of the crises happened. Although the Signaling and Probability methods have the necessary credibility to predict crises, but they short fall, having enough confidence level predicting crises. Thus, efforts should be made in order to develop more efficient models.    

The purpose of this study is to test the hypothesis that inflation uncertainty increase at higher level of inflation. Our analysis is based on the generalized conditional heteroscedasticity (GARCH) class of models, which allow the conditional variance of the error term to be time-varying. Since this variance is a proxy for inflation uncertainty, a positive relationship between the conditional variance and inflation would be interpreted as evidence that inflation uncertainty increase with the level of inflation. Our findings indicate that inflation causes inflation uncertainty (there is a significant positive relationship between inflation, and inflation uncertainty). According to this result, Central bank of Iran can reduce inflation uncertainty by reducing inflation.    

In this paper an optimal portfolio selection is obtained so that it provides the maximal yield and at the same time satisfies the constraints on the value at risk. Value at risk is an important measure of extent to which a given portfolio is subject to different kinds of risk present in financial markets. The optimal weights of each share have been obtained using Genetic Algorithm (Gas). Actually GAs is stochastic parallel global-search algorithms based on the mechanism of natural genetics and the biological theory of evolution. Because GAs exploits strategies of genetic information and survival of the fittest to guide their search, they need not calculate the gradient or assume that the search space is differentiable or continuous. GAs simultaneously evaluates many points in the parameter space, so they are more likely to converge toward a global solution. Gas is very suitable for searching discrete, noisy, multimodal and complex space. The portfolio which is considered in this article has been selected from 12 various companies in the Tehran stock exchange. Simulation results show that the high performance of the VaR approach risk modeling and GA optimization method to selection an optimal portfolio under a pre-specified constraint on the value at risk.    

This paper presents the main deficiencies of monetary policy in Iran. Financial repression is used by monetary authorities. Therefore official interest rate could not be the main channel to affect the real sector. Also the monetary condition Index and the other well know monetary rules are not used to evaluate monetary conditions. Moreover monetary policy instruments are traditional ones and recent development of monetary instruments are disregarded. Fiscal policy leads monetary policy because of oil revenues. In case of decrease in oil revenues, budget deficit is monetized. By the help of a found the monetary policy in Iran does not take into account the economic condition in particular, inflation and GDP gaps.    

Arsanjan is located in northwest of Fars province and is rich in agriculture & jungle. The major problem of this town is water Shortage The water is not enough for agriculture. However, power, moistry is building a dam on the Sivand River in North West of Arsanjan to transfer 60 million cubes meters of the waters this river to this town. This is possible through digging canals from two different directions. Sivand dam -Arsanjan jungle - planting fields around the City and Village of Aliabad-e-Malek.  Deivere dam of Hashtigan-Seidan & Farough Plain-agriculture Fields of and villages of Khobriz and shorab. Transferring water through the second direction is less expensive. But the first area has less water and needs more digging. The second area has semi -salty soil & is not rich. In this research water demand & supply is estimated and the amount of a water Imported from this dam is accumulate with water resource and the excess welfare (consumer & producer surplus) of the population is measured. The results show that transferring water from the first direction is more economic. To do this research stone- Gary utility model to use & 2sls method & optimization agricultural Institutions using linear planning were used.    

Calendar has remarkable effects on the formation of economic activities. In Iran both lunar and solar calendars have been accepted. Each of these calendars has considerable effects on the economic activities in turn. To consider the calendar effects, this paper aims at providing a time series model in the framework of Box and Jenkins approach for the prediction of red meat, chicken and eggs prices in the urban areas of Iran. The utilized data consist of the monthly time series of the variables and some dummy variables to considering the calendar effects. In the recognition of the integration order of studied variables, the technique of beaulien and Miron (1993) is employed. None of the considered variables were nonstationary, but some of calendar effects were significant.    

In this article an attempt has be to assess the employment situation in the by using a labor demand function. By using the cost pattern function of the firm, a construction demand function for labor for the period 1974-2003 has been estimated. By applying the econometric method of ARDL, a long run and a short-run model was estimated: The results show that there exists a negative relation between the real wage rates and the construction employment level and a positive one between the values added of the construction sector and its employment level. The Error Correction Model (ECM) results indicate that the construction demand for labor nears its long-run equilibrium at a rate of 65 percent annually. Finally by using the two scenarios of the model the employment level in the construction sector through the end of The Fourth Planning Program was forecasted. The results of both scenarios show higher employment rates than the ones predicted by The Third Planning Program.