JOURNAL OF APPLIED ECONOMICS STUDIES IN IRAN
Year:2015 | Volume:3 | Issue:12|Papers Count:12

When over-extraction of budget resources for executing special interests policies becomes a behavioural pattern, it results in creating a phenomenon which is known as “common pool problem”. This paper analyses the common pool problem in development projects budgeting in Iran from the view point of the role of electoral institutions which is a determinant of the behaviour of members of parliament who as a matter of fact are one of the most influential groups in allocating the country’s budget. One main question of this study is to examine the impact of amalgamation of constituencies of each province - i.e. provincialising the constituencies – on MPs’ motivational behaviour in pursuing the national development plans against local ones. Consequently, the common pool problem in development budgeting is being addressed.In order to analyse the above-mentioned problem, a mathematical optimising model has been used to measure the degree of resource allocation deviation from a social optimal level before and after the amalgamation of constituencies. The study reveals that by applying this institutional change (1) the common pool problem will be alleviated (2) the MPs will be more motivated to prepare national development projects, and (3) the accountability to local constituencies will be decreased.

Natural gas because of its advantages plays a key role in economy of Iran. Given the continuously rising natural gas consumption, planning in the gas sector by taking into account predicted demand is critical for ensuring sustainable development. In this study we develop models for predicting natural gas demand in residential-commercial, industrial and power plant sectors in Iran using ARIMA (Autoregressive Integrated Moving Average) and Neural Network GMDH (Group Method of Data Handling) approaches. The time series data of natural gas demand, natural gas price and air temperature are used as the model variables. the RMSE, MSE and Prediction Error Percentage indexes are used for comparing this models. The prediction accuracy percentage index for residential-commercial, industrial and power plant sectors in ARIMA method are 93.8, 98.3 and 87 percent and those in Network GMDH method are 96.4, 99 and 98.2 percent respectively. The results indicate better performance and accuracy for the GMDH approach compared to the ARIMA model in predicting natural gas demand.

The main purpose of this investigation is analyzing monopoly power by using conjectural variations approach, in Iran’s manufacturing industries for 4-digit ISIC code over the 1995 to 2011period. In this article a generalized model of Azzam and Lopez (2002) has been used, and supply and demand equations have been estimated with fixed effect two stage least squares (FE2SLS) method. The findings indicate that in 91% of the industries conjectural variation coefficient has been high, and in 88.4% of the Iranian industries price has been higher than marginal cost. Also the results of separating market power and cost efficiency effects on output price owing to changes concentration, in each industry, indicate that market power effect predominates over the cost efficiency effect in the Iran’s manufacturing industries.

Investment as one of the main components of aggregate demand has a substantial effect on business cycle and economic growth. This paper examines the effects of fiscal policy uncertainty on private investment in the context of the Iranian economy. In doing so, an ARDL model and time series data for the period 1973-2009 have been used. To estimate uncertainty, we construct two indices that quantify fiscal policy uncertainty by using the GARCH (p, q) technique. Then, we use them as explanatory variables to estimate their effects on the private investment in two separate models.The results indicate that uncertainty has negative effect on private investment behavior. However, uncertainty index constructed by using government budget deficit volatility reduces investment in short run, the other index has a long run negative effect. Moreover, among control variables, government investment and real exchange rate have significant effect on private investment in short run and long run.

There are different views on explaining the theoretical relationship between government budget deficit and economic growth. The lack of a general consensus on this subject has led to great amount of empirical studies in this area. Many studies have reported controversial results based on factors such as country specifications and time periods, and budget deficit financing methods.Due to ambiguities surrounding the theoretical and empirical analysis the present paper uses Smoothed Transition Regression (STR) model to examine an asymmetric impact of government budget deficit on economic growth in Iran based on seasonal data during of 2010:4 -1980:1.The results indicate that budget deficit in a two regimes structure has affected Iran’s economic growth. In this structure, during recession (with an economic growth less than 37.3 percent) a larger share of budget deficit to GDP, Consistent with the Keynesian view, the budget deficit has a positive effect on economic growth. On the contrary in economic boom (with an economic growth more than 37.3 percent), witnessing a negative effect on economic growth which support the neoclassical view.

The exchange rate as a key variable in economic policis have been considered. Moreover, after applying the floating exchange rate regime in the 70s, the volatility and uncertainty of exchange rates and their effects on international trade also to be considered for researchers. Although most trade models argue that exchange rate volatility increases the uncertainty and risk and therefore reduce trade flows, including imports, however, some studies it suggests the opposite. Hence, This study investigates the impact of real exchange rate uncertainty on import demand of Iran. The period of study is during 1980 – 2012. The EGARCH model is used to generate the log of GARCH variance series. The results from ARDL bounds testing for cointegration show that variable of real exchange rate and import variable are cointegrated. results of short-term dynamics and ECM estimation indicate that Even though there is no long-run impact, but the short-run negative.

The main objective of this paper is to examine the impact of Research and Development Intensity as behavioral variable and market share as structural variables on the Iranian Textiles Industries. For this purpose, data on industrial workshops with 10 employees or more and the Hsiao’s Granger Causality and Granger Causality in panel data is used along with the data during the period of 1995-2009 to study this issue. Moreover, the empirical model of this study has been estimated by the Panel Data approach.The empirical results indicate that the Research and Development Intensity has positive and significant effects on the market share of Iranian Textiles Industries. Hence, in order to change the market structure of monopolistic to competition in the textile industry in Iran, has been the need to support research activities in these industries.

In agricultural activities, multiple inputs and sources are use. The main objectives of farm managers and planners were to optimizing the resources usage and inputs for determining appropriate cropping pattern. Hamedan province and Bahar county has high potential for agricultural productions. The main purpose of research was to investigate optimal cropping pattern for Bahar county for crop years of 2013-2014. For the mentioned aim, mathematical planning and simulation of cropping products on the basis of water input. Data were analyzed by Lingo10 software in mathematical model. In the study, feasibility of efficiency maximization and investment cost, water usage, chemical matters minimization were analyzed according to land limitation and water availability. Results show that for the purpose of mentioned aim planning efficiency of product were increased: 8.44 percent, investment cost 2.94percent, chemical manure usage 3.05, chemical toxins usage 0.88 but water usage 1.99 percent decreased. It can be expected that findings will contribute to agricultural related organizations and planners.

This study investigates the dynamics of a pseudo-panel data approach in the years before and after the implementation of targeted cash subsidies in Iran. For this purpose, a combination of cross-sectional data for the years 1363 to 1392 for a period of 30 years followed and with household budget by born pseudo-panel data in 1305 to 1359. The results show that during the years 1363-1389 (before the implementation of targeted cash subsidies), absolute and conditional mobility in low and unequal opportunity is decreasing over time, but the rate of decline is lower inequality. So it is possible that some differences between rich and poor is reduced over time, but it will be too weak convergence. In fact, the situation is somewhat better for the poor than in the past, but the disparity between them is still somewhat high. After enforcement targeted cash law subsidies as absolute and conditional mobility is low, and the disparity between rich and poor people is so high.

One of the major concerns of the country's economy in the fourth and fifth programs for socio- economic development is the expansion of trade and barter crystallized in the global economy. But the point has always been how to learn or improve their ability to compete with foreign competitors. If the roots of competitiveness and constituent factors affecting the competitiveness can be identified, it could be suggested the solutions to increase the competitiveness of companies in the business environment.Steel industry, as a mother industry, plays an important role in economic development, and dynamics of each country. Thus, investigating the presence or absence of comparative advantage in this industry is necessary. One factor that affects competitiveness by increasing the cost price is the transaction costs. One of the objectives of competition of firm's is reducing transaction costs that indicated its effectiveness in reducing prices. The case study in this paper is Mobrake Steel Corporation and to answer the research questions, domestic resource cost (DRC) index is used. The results of this study in 1390 shows that the company has currently comparative advantage in three selected product groups (Hot and pickling, cold and coated or other), but reducing transaction costs, on average, had the greatest effect on the domestic resources cost index of cold products and hot products has the lowest variation.

Determining minimum wage is one of the strategies to improve the level of welfare of labor force, especially those who are low-skilled. There exists a challenge in Iran regarding this issue among employers, employees and government. This paper investigates a bidirectional relation between real minimum wage and rate during the period 1971-2011 utilizing Toda-Yamamoto and ARDL approaches. Obtained results show that there is not any relationship between these variables implying that wage level does not affect demand for labor force and unemployment. Determining real minimum wage does not comply with unemployment rate. In fact, unemployment rate is not considered in determining minimum wage of the labor force. Furthermore, unemployment rate does not have any influence on real minimum wage. Besides, the analysis of the co-integration relationship between real minimum wage and price index showed that there is no co-integration between the two variables and they do follow each other in the long run.

Effectiveness and efficiency of monetary policy in economics, first of all is related to assumption of exogeneity or endogeneity of monetary policy. Domain of these two assumptions affects Effectiveness, efficiency and regulation of monetary policy. There are so many studies and views about dominance of these two assumptions. Empirical test is a solution for understanding the dominance of different views in a given country. There have been some investigations to study endogeneity of Iran money supply, but here - unlike previous studies – the direct test and Sargan test according to seasonal data between1375-1391 based on two important views of structuralism and accommodationism has been used. The Results show that firstly, money is endogenous. Secondly, concerning the endogeneity of money, structuralisms' approach matches more to Iran economics than accommodationisms' view. Necessary of change in targeting; from monetary targeting and liquidity growth to targeting compatible to endogeneity conditions of money is of the other result of the study.