Journal of Economic Research
Year:2005 | Volume: | Issue: |Papers Count:22

International trade theory argues that developing countries benefit from specializing in primary commodities because of the existence of comparative advantages and the utilization of the countries relative abundant factors. But at the same time, international specialization implies high commodity dependence, which is critisized by som development economists. They stipulate that international specialization as commodity exporters implies a high economic dependence on volatile export earnings due to unpredictability and high instability of commodity prices. The high variability of export earnings undermines macroeconomic stability by crating national income instability. This article analyzes the relationship between non-oil export earnings instability and agricultural growth in Iran. Awareness of instability can help reduce macroeconomic shocks and its impact on other economic sectors. This study applies the Feder (1982) growth model and the Johansen (1988) co-integration system approach to analyze the effects of export earnings instability. The result shows that export earnings instability did not affect gross domestic product (GDP) in the long run, while it had an impact in the short run.

A three Gap Model was developed and estimated using time series data for the 1971-1989 period. Estimates showed a positive and significant impact of investment on of the capacity utilization rate of the Iranian economy. The model was simulated over the period of 1999-2004, taking the Third Development Plans objectives as the target GDP growth rates, which were %5. 5 and %6 per annum in their respective order. The fiscal constraint seems to be binding GDP growth until the end of the Third Development Plan, which is not unexpected when we consider the heavy government involvement in the economy during the period from which the data were drawn. Furthermore due to heavy dependence of government revenues on oil exports, there is a possibility of some overlap between foreign exchange and fiscal constraints in the case of Iran. The findings also indicate that investment would need to grow by %7. 3 and %7. 2 of GDP in the two scenarios respectively in order to achieve a capacity utilization rate growth of %1 per annum.

The globalization, creating numerous opportunities, has caused some important concerns, in particular, for employment and inequality. In this paper, the relation of globalization and employment, for eighteen countries in 1980-2000, has been analyzed by coefficient of correlation and t- test. The ratios of trade to GDP, and FDI to GDP, and the share of manufactures in exports measure the global economic integration- or globalization. On the bases of the correlation analysis for each country, the coefficient sign has been different. In simultaneous study, the coefficient sign of correlation has been negative in all cases and significant for the share of manufactures in exports. Also, the correlation between unemployment rate and the pace of globalization has been as expected and significant. The empirical analysis indicates that active participation in world economy -global economic integration,, can effectively reduce unemployment rate provided that entry of FDI accelerates the share of manufactures in exports. And this certainly requires macroeconomic stability and the improvement of productivity

Money neutrality has been the focus of numerous studies in recent decades. There are a great deal of findings about the way monetary policies impress real sectors, though there is not a clear undrestanding about the final effects of this variable. this study is devoted to examine the long run relationship between real GDP, money outside and inside money), consumer price index, and exchange rate (within the period of 1959-2002), using econometric methods such as TS (Two Stage), Engle Granger, Autoregressive Distributed Lag (ARDL), Johanson-Joselios co-integration and HEGY tests. The results show that both inside and outside money have approximately the same but mirror-like effect on real production. They are also able to explain 0.25 and 0.33 percent of GDP Variations, respectively. However exchange rates role in this regard is about 16 percent. This analysis has doe by using ARDL method shows that the elasticity of GDP to changes in inside and outside money is 0.403 and -0.395 respectively. In other words the impact of these two variables on GDP is the same but mirror-like. Finally the results of Seasonal co-integration and HEGY test defines no co-integration among inside money, outside money and GDP but a non spurious relation among inside money, outside money and CPI. Thus the hypothesis of money neutrally is accepted in Irans economy, and also it becames clear that the exchange rate is one of those important variables affecting production in the long run. What can be recommended here is that monetary authorities can apply monetary policies for deflator goals, as production level is not affected by changes in money supply.

The economists found that the number of physicians per capita correlated positively with the payments they received, and they pointed out that this positive correlation contradicted the results shown by the competitive market, because the number of physicians per capita can be thought of as the degree of competition within the physician Market. They named this fact supplier Induced Demand (SID). In this Paper I am going to show the intuition underlying the SID in the context of Asymmetry Information and Cheap talk signaling game. I show that in this context the SID is only relevant for treatment decision involving an expensive treatment that is equally effective in curing several states, but efficient in curing only some of these state.

If one carefully looks at the recent evaluations in macroeconomic policy then he or she will find a very distinguishable method which John Taylor has called it "New Normative Macroeconomics". The purpose of this paper is to introduce and analyse this new method. The method uses different ideas from most schools of economic thought but can not be regarded as a special school as such. Models and concepts used in the main framework of the so-called new normative macroeconomics in recent years considered to be one of the most active and incentive creating which could not be seen before 1970s even in the economics Dictionaries. For example problems such as 1) policy models; 2) policy rules; 3) policy trade-off which can be regarded as the important ingredients of new normative macroeconomics will be emphasised in the present paper

It has been attempted by using an econometric pattern and integrated data, like cross-section and time-series (panel data), and attempted to examine the economic factors of crimes (homicide and larceny) within 26 provinces of the country for a five years period (1996-2001). The research findings reveal that variables like unemployment rate, income inequality and industrialization are among the most important and with great impact on larceny across the country in this period. At the same time it is argued that increase in industrialization rate has decreased the rate of larceny. According to the findings, Industrial development, fair distribution of income, decreasing unemployment rate and relative poverty are among the most important policy implications in reducing the rate of crime throughout the country.

The economists found that the number of physicians per capita correlated positively with the payments they received, and they pointed out that this positive correlation contradicted the results shown by the competitive market, because the number of physicians per capita can be thought of as the degree of competition within the physician Market. They named this fact supplier Induced Demand (SID). In this Paper I am going to show the intuition underlying the SID in the context of Asymmetry Information and Cheap talk signaling game. I show that in this context the SID is only relevant for treatment decision involving an expensive treatment that is equally effective in curing several states, but efficient in curing only some of these state.

If one carefully looks at the recent evaluations in macroeconomic policy then he or she will find a very distinguishable method which John Taylor has called it "New Normative Macroeconomics". The purpose of this paper is to introduce and analyse this new method. The method uses different ideas from most schools of economic thought but can not be regarded as a special school as such. Models and concepts used in the main framework of the so-called new normative macroeconomics in recent years considered to be one of the most active and incentive creating which could not be seen before 1970s even in the economics Dictionaries. For example problems such as 1) policy models; 2) policy rules; 3) policy trade-off which can be regarded as the important ingredients of new normative macroeconomics will be emphasised in the present paper

Using a partial demand adjustment function, the present study seeks to analyze and estimate the end-use energy efficiency in major Iranian industries. Coefficients of the model include dynamic adjustment rate, direct and indirect price elasticity, income elasticity, and capital intensive coefficient which have been estimated separately for the three energy carriers of electricity, natural gas, and oil derivatives through using panel data of 1979-1999. The model has been estimated for both high energy intensive and low energy intensive groups, as well as industries in general. Findings of the study show that the estimated coefficient of dynamic adjustment rate or error correction coefficient in the end use of oil derivatives was at its highest and in electricity was at its lowest. All the three energy carriers had almost always low price elasticity. Capital intensive coefficient had positive impact on efficiency whereas it showed a negative impact on the use of natural gas.

Using a partial demand adjustment function, the present study seeks to analyze and estimate the end-use energy efficiency in major Iranian industries. Coefficients of the model include dynamic adjustment rate, direct and indirect price elasticity, income elasticity, and capital intensive coefficient which have been estimated separately for the three energy carriers of electricity, natural gas, and oil derivatives through using panel data of 1979-1999. The model has been estimated for both high energy intensive and low energy intensive groups, as well as industries in general. Findings of the study show that the estimated coefficient of dynamic adjustment rate or error correction coefficient in the end use of oil derivatives was at its highest and in electricity was at its lowest. All the three energy carriers had almost always low price elasticity. Capital intensive coefficient had positive impact on efficiency whereas it showed a negative impact on the use of natural gas.

Price ratio of energy carriers on factor costs of production in Irans economy shows a trend, which is not consistent with those of industrial economies and even some energy exporting economies. The mismatch, initiated from heavy subsidizing energy carriers by the government, has caused substitution of energy carriers in place of other inputs, i.e. labour and capital. Although the policy maker has announced boosting economic growth, raising employment and keeping cost of living low, as the goals of the ceiling price policy, the investigations carried out in this paper illustrate that the policy has not met its publicly announced goals. <>br To identify the policy goals of subsidizing energy carriers we conjecture, along the line of political business cycles theory, that the policy maker has subsidized energy carriers to attract votes of voters. Comparing the trend of energy subsidies with the timing of election periods reveals that political cycles can partially explain the trend of energy subsidy in Irans economy.

The functional form of the consumer allocation models should be to satisfy theoretical properties derived from the theory consumer demand and it must be able to explain the behavior of the consumer and the realized facts by the real data. At the first part of this paper, we have explained some of the theoretical characteristics of the consumer demand theory, then 4 different systems approach that explain the behavior of the consumer have been studied and hybrid model of CBS and NBR has been introduced. At the second part of this paper, an empirical study has taken place by using consumption expenditure data of the urban households in Iran during the period 1971-2001. The result shows that CBS model is more consistent than other models with theoretical properties of the demand

This Paper Studies the impact of the factors on the demand side on employment changes during 1986-1996. The demand side of the economy can be analyzed on the basis of: the changes of the final domestic demands, intermediate demand changes or the demand of the manufacturing sector for the intermediary products which indicates the technological changes of the production, changes of the foreign demands (export expansion) and change in the combination of demands (imports substitution). In addition, the productivity changes can also have a considerable role on employment. The result of this study shows that in the time period of 1986-1994, the average growth rate of employment has been 3. 01% per year in which the impact of the domestic market for the final products was 1. 5%, the impact of the export expansion was 0. 18%, the impact of the import substitution was 1. 47% and the impact of the technological changes was 0. 53%. Also the impact of the productivity on the employment growth was about 0. 68%

It is quite sometime now that the design and implementation of a VAT has turned into a debate in the pubic finance in Iran. But, as it has always been, the impact of a VAT on inequality is a major concern in making a decision for its implementation. This paper, using the analytical method, intends to make an estimate of the possible impact of a VAT on inequality in Iran on the basis of the five suggested possible scenarios. Using the selected model and national input-output table, it tries to calculate the share of present indirect taxes or future VAT in the prices of the goods and services in each scenario. The results are then compared with household consumption, using the ISIC classifications. By estimating the Engle Curve for each consumed item in the household budget, the cost of the VAT implementation for each ten brackets of the of the household is then calculated. Putting the resulting figures in two groups of distributional and tax system equity indicators, reveals the regressively of the tax in all five scenarios. However, measuring the importance of the impact it could be safely concluded that the inequality variable in Iran would not be significantly affected by the implementation of a VAT.