IRANIAN JOURNAL OF APPLIED ECONOMICS
Year:2011 | Volume:1 | Issue:3|Papers Count:6

This study investigates the relationship between inflation; inflation uncertainty; investment growth and economic growth, over the period 1367‐ 1387 in Iran. We used Trivariate‐GARCH model and our results indicate that the hypothesis of Friedman (1977) and Ball (1992) concerning that the increase in inflation rate, leads to inflation uncertainty, is not rejected for Iran during the period of our study. Thus, we conclude that any variable that increases the rate of inflation, leads to inflation uncertainty and consequently reduces the economic growth in Iran. Therefore it is helpful if government pursue an inflation targeting policy. Our results also confirm that any increase in inflationary uncertainty reduces the rate of investment and production as indicated by Bernanke (1983); Dixit & Pyndyk (1994) and Friedman (1977). Finally our model rejects the hypothesis of Holland (1995) i.e. there exist a negative causality between inflation uncertainty and inflation rate.

In this study, we investigate the long‐run relationship between demand for imports and the relevant determining factors. We use the method of least Squares Engel Granger (1987) and Maximum Likelihood Johansen (1988) as well as Joe Hansen and Joe Sylyvs (1990) to estimate the Long‐Run Import Demand Function.To have a better assessment of the effectiveness of trade policies; a logical understanding of demand for imports is of particular importance. Our study shows that the oil revenue, real income, and GDP evaluated at domestic prices, are positively related to demand for imports. On the other hand, the rises of price of imported goods relative to the price of domestically produced goods and currency devaluation have a negative effect on demands for imports of intermediate goods as well as consumption and capital goods.

The purpose of this study is to analyze the asymmetric effects of oil price shocks on economic growth in Iran. There are two hypotheses in this study: First, any reduction of oil prices leads to lower economic growth in Iran and second, the positive impact of an equal increase of price of oil on economic growth is less than the negative effect. Therefore the effects are asymmetric.We use Vector Auto Regression model to estimate our model. Our model shows that shockwaves in oil price have a greater impact on economic fluctuations in Iran than other macroeconomic variables. We also use Hydric‐ Prescott filtering to separating positive and negative shocks and confirm their asymmetric effects.

In this survey, we study the impact of the economic stability on demand for money in Iran. We use ARCH‐GARCH model to introduce an Economic Stability Index (ESI), which is a weighted average of variables such as gross domestic product (GDP), foreign exchange rate, inflation rate, long‐term interest rate, and Stock Market Average Price Index.With the help our calculated ESI and employing the ARDL method we estimate the demand for money in Iran for the period of 1352‐1387. The results of our study show that the Economic Stability Index has a positive impact on demand for money in Iran.

Road accidents and casualties resulting from the current one of the challenges communities, which have large economic costs on the economy has forced countries. Comparison of aspects of development of countries, most victims of this crisis in developing countries make up. Unfortunately, Iran is among the countries where the rate of accidents caused by inattention to safety principles and other related factors has always ascending; so that current statistics show the severity of this issue in Iran.This study, aim to evaluate the relationship between road accidents and economic indicators in the form of the Environmental Kuznets hypothesis (EKC). Based on the hypothesis, the road mortality rate increases in the early stages of economic growth and ultimately decreases because of technical progress, increasing in capital investment and improve care medical. The results show that the relationship between road accidents and per capita income is inverted U shape, and actually the Kuznets hypothesis has confirmed by Iranian data. The results also indicated that the capital investment in the roads, making safe cars and education have an important role in reducing road accidents.

In this study, with the help of Feder’s Growth Model (1982), the authors try to explain the relationship between export and Economic Growth in Iran for the period of 1353-1384. Using autoregressive distributed lag (ARDL), a model is estimated by dividing the overall production of the economy into three sectors: Oil exporting production; Non-oil exporting production and production for domestic market. This study showed that investment in non-oil sector has significant positive impacts on economic growth, and its effect tended to last for several years. On the other hand, investment in other sectors has smaller and statistically less significant impacts on economic growth.