Financial Economics
Year:2017 | Volume:10 | Issue:37|Papers Count:8

Capital is an important component of bank funding, allowing the bank to hedge against the undesired economic fluctuations and circumvent default risk, continuing to gain profit. The banks that have excess capital (defined as bank’s required capital minus the risky assets) in the face of economic fluctuations have better performance. In this paper, we study the impacts of the nominal and real shocks through the behavior of excess capital on bank lending in a panel of Iranian banks during the period of 1385 - 1393, using GMM approach. The results show the positive effect of the interaction between nominal shocks and excess capital on bank lending, as well as interaction between real shocks and the excess capital having negative effect on the bank lending in Iran. In other words, in a tight monetary regime, the excess capital has negative effect on bank lending and restricts the lending power of the banks. However, in expansionary monetary regime, this impact is smaller. On the other hand, more excess capital increase the positive impact of nominal shocks on bank lending, while decrease the impact of real fluctuations on lending.

Banks are strongest component and pivotal player in the Iranian economy. Banks that certainly must be profitable. Now if we suppose that bank profits is a function of variables such as resources, facilitate investment and … Naturally, each of them is changed, the bank's earnings will fluctuate. Economic policy makers of banks will have to choose a procedure and political factors and inflation.... at least for the banks make losses. In this study, the main objective is uncertainty of GDP and inflation on the sources and uses of Melli bank. For this purpose, uncertainty of GDP and inflation calculated by combination of models EGARCH and ARIMA. Then we will investigate relationship through Vector Autoregressive Models (VAR) and Vector Error Correction Models (VECM) and on sources and uses in the short-term and long-term. We will conclude that the effect of uncertainty of GDP and inflation on sources of Melli Bank is significant and negative in the short term and long term. And the effect of uncertainty of GDP and inflation on uses of Melli Bank is significant and positive in the short term and long term.

In this paper, the performance of the law granting tax exemptions to Export–Processing Zone as one of the means to expand the industrial exports and facilitating access to international markets has examined. It Seems in developing countries, free trade zones - industrial most appropriate method for providing free trade conditions in a limited area of the country. In recent years, many developing countries, which are aimed at developing industrial exports, job creation and technology transfer through attracting direct foreign investments, the establishment of the free zones. The purpose of this study the performance of the law; granting tax exemptions as an incentive economic activity in the free zones during the 1393 - 1374 with the use of information and the inference method is present research hypothesis, granting tax breaks, a factor in the spread of production, investment and exports of employment in free zones.

This study investigates the persistent of different earnings components and questions that whether investors at the time of pricing of securities, have an appropriate understanding of the information contained in earnings components for the future earnings, and are they capable of reflecting earnings components in the prices? The sample consists of 140 firms listed in Tehran Stock Exchange during the period 2010 to 2014 Analysis of the data using regression shows that, operational component versus non-operational component, cash component versus accrual component, accrual component of operational earnings versus accrual component of non-operational earnings, cash component of operational earnings versus cash component of non-operational earnings, have more persistent. Also the analysis forecasting systems of simultaneous equations with test Mishkin (1983) showed that utilizes the definition of accruals, profit components in more detail, are priced it was found that benefiting from the definition of total accruals, earnings components are priced more accurately.

This study examines the relationship between exchange rate fluctuations and economic growth based on financial deepening level of 30 countries during 2000-2013 period.We introduced a model to describe currency fluctuations and financial deepening especially in economic crisis condition. For this purpose, we introduced the ratio of credit granted to the private sector to GDP as financial development indexes. The findings based on Panel data model, shows that high levels of financial development has casued more positive effects of exchange rate fluctuations on economic growth in countries with higher financial deepening indexes. This results is inverse for those countries which have low level of financial development ranking.So currency fluctuations effectiveness on economic growth has been negative in the lower levels of financial development.

Investors make their investments by considering available information, including the information provided in financial statements. Good news result in positive reactions by the investors and bad news result in their negative reaction. The concern for finding the relationship between ROE and the unexpected portion of companies’ earnings announcements lead to the introduction of the concept of earnings response coefficient, or ERC. The main goal of the present survey is to study the determinants of the ERC in the Tehran Stock Exchange. To perform this, the data for 158 corporations present in the Tehran Sock Exchange during 2006 to 2011 have been collected. Then the determinants of ERC have been studied. These determinants are: interest rate, systematic risk, growth opportunities and the financial leverage. The methods used for the study and the test of hypothesis are the econometric methods based on the panel data.The results of the study show that the financial leverage and the systematic risk have a negative and significant effect on the ERC, while the growth opportunity determinant has a positive and significant effect on the ERC. No significant relationships were found for the interest rate determinant.

Expanding manufacturing industries is considered as one of the most important development policy. In the meantime, productivity variable is in lieu of cumulative index for most of the economic and social variables. As the country's industrial development and increase productivity, financial development and economic growth will be the result.In other words, indicators of financial development and capital accumulation affects the productivity indicators and thus affect economic growth. So, the main question is that how the productivity is reached in various industries or does this productivity go through the industrial activities to convergence. The main question of the debate is that does the split between total productivity levels of production factors, capital and labor force is a determinant factor for financial development and sigma convergence or not? In this debate, partial productivity of capital and labor force is being studied in form of production rate toward desired input, total productivity of production factors is measured by Divisia index and relation between them and sigma convergence among manufacturing industries has been investigated during 1994-2007. To answer this question, we test a hypothesis that the average of dispersion of total productivity level of production factors, capital stock and labor force in manufacturing industries of Iran are reducing from their average in total industries. By means of panel data, sigma convergence hypothesis test was used. The results of tests show that no evidence is seen to prove sigma convergence among manufacturing industries.

This paper pays to the effect of asymmetric information in insurance markets contracts. Based on a sample survey consist of 2000 auto insurers in Tehran City , with using Morgan test, we select 300 insurers in automobile insurance which are chosen randomly. We designed a model which included insured age, driving experience, degree of education, automobile type and individual who have an accident or have not an accident performances in 2010. Via a Probit model estimation and risk functions of individuals and coordinating with Chiappori (2006), we tested asymmetric information effect by using of STATA software.The findings show that, people who chose higher insurance coverage, do not have higher likelihood accident necessarily. Besides this, we found out that there is no significant correlation between asymmetric information and degrees of risk in automobile insurance. However, we released that there is significant correlation between degrees of education and number of accidents.