Journal of Quantitative Economics
Year:2008 | Volume:5 | Issue:3 (18)|Papers Count:8

In this paper, we analyze the effect of monetary policy in house price bubble for booms and busts cycles. We use price to rate model for house price bubble calculation. Therefore, we employ ARDL model with quarterly data from (1992 - 2006) for Iran. Our results reveal the formation of bubble which differ from booms and busts cycles. The effect of monetart policy on house price bubble in booms cycles is more than busts cycles. Expansionary monetary policy makes the house price bubble in forming booms and busts cycles. Interest rate is the most important and effective variable on house bubble in boom cycle. Effect of liquidity growth rate in busts cycles is more than booms cycles. Effect of asset prices variables in busts cycles is more than booms cycles. our results indicate that monetary authority should tighten when house price bubble is inflating and it should ease when house price bubble collapses.JEL classification: E5 , E3 , R21 , B23

In this paper, we attempted to examine the impact of trade and financial liberalization on both real and financial sectors of the Iranian economy. We used a Vector Auto Regression (VAR) model to test our hypothesis. The result shows that trade liberalization plays an important role in the economic growth and financial development. However, financial liberalization has had negligible impact, indicating that if financial liberalization is to have its significant effects on the economy, the government has to provide pre-requisites and pre-conditions needed. Until then the country has to follow a prudential financial policy.JEL classification: K11 , K12 , K13

In this paper, the structures of Aluminum Ore (AlO), Concentrate (AlC) and Metal (AlM) markets have been analyzed using Concentration Ratio (CR) and Herfindahl Index (HI) during 2001-05. The structure of their world imports and exports is oligopolistic. However, this structure for ALO and ALC is nearly loose and tight oligopolistic, respectively. During this period, the monopolistic power of the world importers slightly decreased but the structure remained intact. The USA played a major role in the imports of ALO and ALC whilst Brazil is known as the best exporter. Also Japan for importing and Russia for exporting of AIM possess central positions in the world market. The known aluminum resources in Iran are very limited. Therefore the most of the required raw materials are imported. The two governmental companies are the main AlM producers. The CR of the two firms is 100, and HI reached 50% and its reverse is equal 2. This shows that the total domestic production of AlM is equally divided between these two corporations. Therefore, structure of this market is state-monopolized. In the other hand the demand-side has a competitive structure.JEL classification: F00 , D21

In this paper we review the zone and extent of mathematics in economics and application of each mathematical subject on economic theories. Also for assessment the knowledge of graduate students in Iran with important mathematical subjects that used in economics, a questionnaire is provided in it the extent of knowledge of students with following discussion is surveyed: differential calculus, sets, topology, linear and nonlinear programming, series, ordinary differential equation and difference equation, numerical calculus, control theory, riot models, differential equations with parial derivative, game theory and differential games. Our results shows that graduate students in Iran know the mathematics that come back to the 1960 and this knowledge notwithstanding of importance, has a weak role for understanding today papers and books in mathematical economics. Our finding claims that mathematics in fourth epoch (after 1990) have a critical role in remark and extend of new economic theories but the graduate students of economics in Iran have a little knowledge about this and they did not feel the necessity of it.JEL classification: C02

This study investigates the validity of the demand-following, the supply-leading, the export-led growth and the import-led growth hypotheses and direction of causality between financial development and international trade in Iran. The Bounds Testing Approach to cointegration is conducted to establish the existence of a long-run relationship between these variables. An augmented form of Granger causality analysis and Toda and Yamamoto procedure is implemented to identify the existence and the direction of causality. The empirical findings confirm the demand-following hypothesis in short run. The export-led growth hypothesis and a unidirectional causation from financial development to import are also supported by the results.JEL classification: F13 , C12

Income inequality is considered as one of the main economic problems. Income inequality affects the consumption structure via the changes in demand and the composition of expenditure basket. This paper investigates the relationship between expenditure consumption and income inequality and studies their trends in the Iranian Households’ Survey. For this purpose, we have exploited household income groups data from 1979 to 2005.The results indicate that all the fluctuations of income inequality do not transmit into the composition of consumption expenditure.JEL Classification: D31 , D32

After collapse of Smithsonian agreement, many countries accepted floating exchange rate system, while the majority of their central banks engaged in exchanges transactions due to decreasing volatilities in exchange rate markets. By Accepting a floating exchange rate system, it is required to maintain optimal international reserves level. In this research using Random Walk model, we have determined the optimum level of international reserves for 1961-2004 period. By implementing VAR model, international reserves impulse response functions for oil price increases and the imposed war are also investigated. Random Walk model outcomes show that central banks international reserves are not according to the estimated optimum quantities, except for a few years. They are normally less than mentioned quantities. Results of the Random Walk model show that real level of reserves is less than level of optimum quantities for periods 1961-1972 and 1984-1998. moreover, real level of reserves is more than level of optimum for years 1973-1983 and 1999-2004. Analysis of impulse response functions show that oil price shocks has increased the international reserves for periods 1973-81 and 1999-2004 and the imposed war leads to decreasing the international reserves compared to the optimal level .JEL Classification: C22 , F35 , C61