ORIGINAL_ARTICLE
Modeling the Competition between Public Debt Creditors in Iran: An Application of Bankruptcy Games
The Government in Iran plays a substantial role in the economy through financial interactions extended to various fields and many organizations. In recent years, investigation of such economic interactions indicates a considerable government debt for 2016, estimated at around 45% of GDP or two times of public budget. Given that Iran experiences tough sanctions and its oil export is restricted, many studies and experts assert that the government's income will decrease and its debt will increase even further. For creditors, this means that they are likely to face difficulties to get their money back and must compete with each other for that. The fierce competition among the government's creditors is quite understandable. The budget dedicated to paying off debts to private and public entities is only a tiny fraction of their demands. This paper tries to model the creditors' preferences using different asset allocation methods in bankruptcy games and finds a solution that may be consented. Results show that the Shapley Value dividing rule has the highest chance to be selected as social selection. Using this method, of the 450 thousand billion Rials in the public budget allocated to pay off public institutions and organizations (including private banks), the Social Security Organization (SSO) and government banks receive 137 thousand billion Rials (16.1% and 24.2% of their demands, respectively), private banks and credit institutions receive 127 thousand billion Rials (31%), public contractors receive 35 thousand billion Rials (26.3%). Other public entities receive 13 thousand billion Rials (28.3%) for their demands.
https://ier.ut.ac.ir/article_86967_dcd158cb3aee645b88ee94575f3c8438.pdf
2022-03-01
1
18
10.22059/ier.2022.86967
Bankruptcy Games
Public Debts
Social Choice
Abbas
Khandan
khandan.abbas@khu.ac.ir
1
Department of Public Affairs, Faculty of Economics, Kharazmi University, Tehran, Iran
LEAD_AUTHOR
Alcalde, J., Marco, M. C., & Silva, J. A. (2012). The Minimal Overlap Rule: Restrictions on Mergers for Creditors' Consensus. TOP, 22, 363-383.
1
---------- (2005). Bankruptcy Problems and the Ibn Ezra's Proposal. Economic Theory, 26, 103-114.
2
---------- (2008). The Minimal Overlap Rule Revisited. Social Choice and Welfare, 31, 109-128.
3
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4
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5
Csóka, P., & Herings, P. J. (2019). Liability Games. Games and Economic Behavior, 116, 260-268.
6
Degefu, D. M., He, W., Yuan, L., Min, A., & Zhang, Q. (2018). Bankruptcy to Surplus: Sharing Transboundary River Basin's Water under Scarcity. Water Resource Management, 32, 2735-2751.
7
Falahati, A., Fatahi, S., Heidari Disgarani, A., & Shokri, N. (2018). An Investigation of Fiscal Sustainability and Fiscal Transitory Shocks in Iranian Economy. Journal of Financial Economics (Financial Economics and Development), 11, 123-154.
8
Fathalizadeh, M. (2016). Assessing the Iranian Fiscal Sustainability in Past and Future through Tax Side of the Economy. Iranian Economic Review, 20(2), 187-201.
9
Fattahi, S., Heidari Disgarani, A., & Askari, E. (2014). The Study of Government Debt Sustainability in Iran's Economy. Quarterly Journal of Fiscal and Economic Policies, 2(6), 67-86.
10
Habibi, F., & Sharif Karimi, M. (2017). Foreign Direct Investment and Economic Growth: Evidence from Iran and GCC. Iranian Economic Review, 21(3), 601-620.
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Islamic Parliament Research Center. (2020). Fixing Budget Deficit Guidelines Subject to Policymaking Constraints. Retrieved from Plan and Budget Studies Bureau.
13
Khandan, A. (2018). An Investigation into Methods of Public Debt Repayment to Main Creditors Including Banks, Insurance Funds, and Contractors. Tehran: Social Security Research Institute (SSOR).
14
Khiabani, N., Karimi Petanlar, S., & Motameni, M. (2012). Analyzing Iranian Government Fiscal Stability through Multicointegration. The Journal of Planning and Budgeting, 17(1), 73-89.
15
Komijani, A., & Gudarzi Farahani, Y. (2016). Government Financial Sustainability in Iran with Co-integration Approach. Economic Studies and Politics, 104, 3-26.
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Law on the Comprehensive Welfare and Social Security Organizational Structure. (2004). Social Security Organization (SSO) of Iran. Retrieved from https://rc.majlis.ir/fa/law/print_version/94018
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Ministry of Economic Affairs and Finance. (2016). Rule Determination (Ceiling) for Public Debts in Iran. Deputy of Economics, Bureau of Fiscal Researches and Policies, Department of Modeling and Management of Economic Data, Retrieved from https://econo.mefa.ir/
18
Mirbahari, S. M. (2015). Exploring the Structure of Government Indebtedness to the Central Bank of Iran and Comparing it with International Standards. Quarterly Journal of Ravand, 70, 101-129.
19
O'Neill, B. (1982). A Problem of Rights Arbitration from the Talmud. Mathematical Social Sciences, 2, 345–371.
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Salmani, Y., Yavari, K., Asgharpour, H., & Shahabi, B. (2018). The Macroeconomic Effects of Government Debt in Iran. Journal of Economic Modeling Research, 8(32), 129-177.
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Schwartz, A. (1993). Bankruptcy Workouts and Debt Contracts. The Journal of Law and Economics, 36(1), 595-632.
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Thomson, W. (2015). Axiomatic and Game-theoretic Analysis of Bankruptcy and Taxation Problems: An Update. Mathematical Social Sciences, 74, 41–59.
23
Tsay, M. H., & Yeh, C. H. (2019). Relations among the Central Rules in Bankruptcy Problems: A Strategic Perspective. Games and Economic Behavior, 113, 515-532.
24
ORIGINAL_ARTICLE
Implications of Isolationist Policies on Regional Integration in Africa
The renewed isolationist rhetoric among countries in the global north has implications for international trade integration. This study investigated the effect of isolationist measures on regional trade integration in Africa. The export supply function was estimated with a dynamic Markov switching model utilizing data between January 2005 and December 2018 for five African countries (Nigeria, Kenya, South Africa, Uganda, and Morocco). The results showed that the current isolationist policies have made Kenya and Uganda conduct more of intra-African trade; Uganda and South Africa to be more integrated into their regional economic trade blocs; and have generated a significant shift in the trade direction of Nigeria, South Africa, and Morocco in favor of non-traditional extra-African trade directions. The key drivers of intra-Africa trade integration are industrial production and relative prices. Hence, African countries need to deepen and synchronize industrial policies, target low inflation and reform their equity markets to foster higher industrial performance required for deeper intra-African trade integration.
https://ier.ut.ac.ir/article_86968_f2a2dc430e5421113a02439e49719438.pdf
2022-03-01
19
44
10.22059/ier.2022.86968
Isolationist Policies
Intra-African Trade Integration
Export Supply Function
Extra-African Trade
Markov Switching Model
Solomon
Abayomi Olakojo
sa.olakojo@mail1.ui.edu.ng
1
Department of Economics, University of Ibadan, Ibadan, Nigeria
LEAD_AUTHOR
Emmanuel
Ogunkola
waleogunkola@yahoo.com
2
Department of Economics, University of Ibadan, Ibadan, Nigeria
AUTHOR
Dodaro, S. (1993). Exports and Growth: A Reconsideration of Causality. The Journal of Developing Areas, 27, 227-244.
1
Draper, P. (2010). Rethinking the (European) Foundations of the Sub-Saharan African Regional Economic Integration: A Political Economy Essay. OECD Development Centre Working Paper, 293, Retrieved from https://www.oecd-ilibrary.org/docserver/5km5zrs9075k-en.pdf?expires=1591695068&id=id&accname=guest&checksum=9825E2895F47DFE78A8FD0BF9CCA2216
2
United Nations Economic Commission Africa. (2017). Assessing Regional Integration in Africa VIII. Bringing the Continental Free trade Area About. Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-viii
3
---------- (2016). Assessing Regional Integration in Africa VII: Innovation, Competitiveness and Regional Integration. UNECA Policy Research Report, Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-vii
4
---------- (2014). Assessing Regional Integration in Africa VI: Harmonizing Policies to Transform the Trading Environment. UNECA Policy Research Report, Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-vi
5
---------- (2012). Assessing Regional Integration in Africa V: Towards an African Continental Free Trade Area. UNECA Policy Research Report, Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-v
6
---------- (2010). Assessing Regional Integration in Africa IV: Enhancing Intra-African Trade. UNECA Policy Research Report, Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-iv
7
---------- (2008). Assessing Regional Integration in Africa III: Towards Monetary and Financial Integration in Africa. Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-iii
8
---------- (2006). Assessing Regional Integration in Africa II: Rationalizing Regional Economic Communities. Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-ii
9
---------- (2004). Assessing Regional Integration in Africa I. UNECA Policy Research Report. Retrieved from https://www.uneca.org/publications/assessing-regional-integration-africa-i
10
Gavin, B., & De Lombaerde, P. (2005). Economic theory of Regional Integration. In Farrell, B. Hettne, and L. Van Langenhove (Ed.). Global Theory of Regionalism: Theory and Practice. London: Pluto Press.
11
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12
Laursen, F. (2008). Theory and Practice of Regional Integration. Jean Monnet/Robert Schuman Paper Series, Retrieved from http://aei.pitt.edu/8219/1/LaursenLongSympos08RegIntegedi.pdf
13
Lee, M. (2002). Regionalism in Africa: A Part of Problem or a Part of Solution. Numero Special Polis, 9, 1-24.
14
Hartzenberg, T. (2011). Regional Integration in Africa. World Trade Organization (WTO) Staff Working Paper, ERSD-2011-14, Retrieved from https://www.wto.org/english/res_e/reser_e/ersd201114_e.pdf
15
Archawa, P., & Townsend, R. M. (2019). The Impact of Regional Isolationism: Disentangling Real and Financial Factors. Puey Ungphakorn Institute for Economic Research, PIER Discussion Papers,109, Retrieved from https://www.robertmtownsend.net/sites/default/files/files/papers/working_papers/Villages%20-%2022%20April%202019.pdf
16
Negasi, M. Y. (2009). Trade Effects of Regional Economic Integration in Africa: The Case of SADC. Services Sector Development and Impact on Poverty Thematic Working Group, Retrieved from http://www.tips.org.za/files/13.Trade_effects_of_Regional_Economic_Integration_-_SSD.pdf
17
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Oyejide, A., & Njinkeu, D. (2001). Implementation of the Trade Liberalization Programs of African Regional Integration Arrangements. Fourth Ordinary Session of the Conference of Ministers of Trade of the OAU/AEC, Abuja (Nigeria), Retrieved from www.aercafrica.org/documents/AWTS/paper2.doc
19
Tanyanyiwa, V. I., & Hakuna, C. (2014). Challenges and Opportunities for Regional Integration in Africa: The Case of SADC. IOSR Journal of Humanities and Social Science, 19(12), 103-115.
20
ORIGINAL_ARTICLE
Fiscal Vulnerability and Transport Infrastructure Development in Nigeria
In spite of the massive revenue emanating from oil wealth, the successive government of Nigeria failed to give its citizenry the dividend of democracy owing in large part to their inability to establish a market clearing situation because of inadequate linkage between the sources and the markets (transport infrastructures). An Inquiry into the cause and potential solutions to the problems of transport infrastructure development in Nigeria informed the need to regress indices of fiscal vulnerability on the indicator of transport infrastructure development in Nigeria from 1986 through 2017 using the dynamic ordinary least squares regression technique. Results show that high-level fiscal vulnerability deters optimal government expenditure on transport infrastructure development in Nigeria. Based on the findings of the study, it is recommended that government should do more to block all leakages of fiscal revenues and subsequently ensure that more allocation is channeled into transporting infrastructure development because of its forward and backward linkages.
https://ier.ut.ac.ir/article_86969_e79164720349a5d431b976de59b0ac41.pdf
2022-03-01
45
60
10.22059/ier.2022.86969
Keywords: Fiscal Vulnerability
Transport Infrastructure Development
Nigeria. JEL Classifications: H5
E44
H12
R4
Ibrahim
Adekunle
adekunle_ia@yahoo.com
1
Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria
LEAD_AUTHOR
Isiaq
Oseni
osenioou@yahoo.com
2
Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria
AUTHOR
Ayomide
Ogunade
ayomideolayinka09@gmail.com
3
Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria
AUTHOR
Afonso, W. B. (2014). Fiscal Illusion in State and Local Finance - A Hindrance to Transparency. Sage Journals, 46(3), 219–228.
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56
ORIGINAL_ARTICLE
Money Demand Function: A Re-assessment in Sub-Saharan Africa
The paper re-examines the money demand function in sub-regions of Sub-Saharan Africa and its sub-regions with annual time series spanning between 1980 and 2017. Panel homogeneous Autoregressive Distributed Lag, panel co-integration tests, and Dumitrescu and Hurlin panel causality test were employed for analysis. The empirical results showed a co-integrating relation between money demand and its determinants in SSA and its sub-regions. The results also indicated divergence in terms of short-run determinants, long-run determinants, and error correction due to shocks across the sub-regions. The causality test revealed a bi-causal relationship between money demand and its determinants in SSA economies. However, there was divergence in the causality results across the sub-regions. We conclude that price level is the major driver of money demand in Sub-Saharan Africa. The paper, therefore, recommends that governments in SSA economies should employ policies that can enhance price stabilization, which will consequently lead to money demand stability in the whole region.
https://ier.ut.ac.ir/article_86970_1783c8418e6521cf5c4679cb8f4b61ab.pdf
2022-03-01
61
77
10.22059/ier.2022.86970
Price Stability
Autoregressive Distributed Lag
Co-integration
Divergence
Anthonia
T. Odeleye
aodeleye@unilag.edu.ng
1
Department of Economics, University of Lagos, Lagos, Nigeria
LEAD_AUTHOR
Darlington
Akam
akamdarlington@gmail.com
2
Department of Economics, University of Lagos, Lagos, Nigeria
AUTHOR
Aiyedogbon, J. O., Ibeh, S. E., & Edafe, M. (2013). Empirical Analysis of Money Demand Function in Nigeria: 1986 – 2010. International Journal of Humanities and Social Science, 3(8), 132-147.
1
Al Rasasi, M. H., & Banafea, W. A. (2018). Estimating Money Demand Function in Saudi Arabia: Evidence from Cash in Advance Model. SAMA Working Paper, 18, Retrieved from http://economics.mit.edu/files/9417
2
Anwar, S., & Asghar, N. (2012). Is Demand for Money Stable in Pakistan. Pakistan Economic and Social Review, 50(1), 1-22.
3
Arize, A. C., & Nam, K. (2012). The Demand for Money in Asia: Some Further Evidence. International Journal of Economics and Finance, 4(8), 59-71.
4
Asongu, S. A., Folarin, O. E., & Biekpe, N. (2018). The Long Run Stability of Money Demand in the Proposed West African Monetary Union. MPRA Working Paper, 92343, Retrieved from http://mpra.repec.org
5
---------- (2019). The Stability of Demand for Money in the Proposed Southern African Monetary Union. EXCAS Working Paper, WP/19/062, Retrieved from SSRN_ID3467521_code2294135
6
Carrera, C. (2016). Long-Run Money Demand in Latin America Countries: A Non-stationary Panel Data Approach. BCRP Working Paper, Retrieved from www.bcrp.gob.pe › publications › working-papers
7
Dai, M. (2009). On The Role of Money Growth Targeting under Inflation Targeting Regime. Bureau D’economie Theorique et Appliquee, Retrieved from https://mpra.ub.uni-muenchen.de/13780/1/MPRA_paper_13780.pdf
8
Debrun, X., & Masson, P. R. (2013). Modelling Monetary Union in Southern Africa: Welfare Evaluation for the CMA and SADC. South African Journal of Economics, 81(2), 275-291.
9
Drama, B. G. H., & Yao, S. (2010). The Demand for Money in Cote d’ Ivoire: Evidence from Co-integration Test. International Journal of Economics and Finance, 14(1), 47-60.
10
Dumitrescu, E., & Hurlin, C. (2012). Testing for Granger Non-causality in Heterogeneous Panels. Economic Modelling, 29(4), 1450-1460.
11
Ekpoh, A. H., & Udoh, E. (2013). Policy Coordination Framework for the Proposed Monetary Union in ECOWAS. In Regional Economic Integration in West Africa, Part of the Series Advances in African Economic, Social and Political Development, Retrieved from https://publications.akpanekpo.com.ng/works/1/Policy%20Coordination%20Framework%20for%20the%20Proposed%20Monetary%20Union%20in%20ECOWAS.pdf
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13
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Gottschalk, J. (1999). A Co-integration Analysis of a Money Demand System in Europe. Kiel Working Paper, 878354, Retrieved from https://www.econstor.eu/handle/10419/47056
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Hadri, K. (2000). Testing for Stationary in Heterogeneous Panel Data. The Econometrics Journal, 3(2), 148-161.
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Hamori, S. (2008). Empirical Analysis of the Money Demand Function in Sub-Saharan Africa. Economics Bulletin, 15(4), 1-15.
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40
ORIGINAL_ARTICLE
An Analysis of the Conditional Relationship between Risk and Return in the Tehran Stock Exchange
This paper examines the factors that affect stock returns in the Tehran Stock Exchange, the largest stock exchange in Iran. In particular, we analyze the conditional relationship between risk and return in Iran by estimating the relationship between various sources of risk - market risk, oil price risk, exchange rate risk, gold price risk, inflation risk, skewness, and kurtosis - and the stock return in the Tehran Stock Exchange over the period March 2005 to March 2019. The methodology used in this paper is a multi-factor model that allows the impact of the risk factors to have asymmetric effects depending on whether returns for the respective risk factor are increasing or decreasing. We analyze the risk-return relationship for four groups of industries: the top ten industries by market cap, the five largest energy-consuming industries, the four major export industries, and the four major import industries. We find significant conditional relationships between risk and return for all the risk factors considered.
https://ier.ut.ac.ir/article_86971_884c2e277ff8693fdf9828018594ee66.pdf
2022-03-01
79
107
10.22059/ier.2022.86971
risk
Return
Multifactor Conditional Model
Iran
Mahdieh
Rezagholizadeh
m.gholizadeh@umz.ac.ir
1
Faculty of Economics, University of Mazandaran, Babolsar, Iran
LEAD_AUTHOR
C.-Y. Cynthia
Lin Lawell
clinlawell@cornell.edu
2
Charles H. Dyson School of Applied Economics and Management, Cornell University, New York, United States
AUTHOR
Kazem
Yavari
kyavari@gmail.com
3
Department of Economics, Management & Accounting, Yazd University, Yazd, Iran
AUTHOR
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ORIGINAL_ARTICLE
Islamic Solutions for Behavioral Problems in Economy
Since late 19th century social sciences have been stuck within the deterministic views of natural sciences. Getting further away from the real nature of human being, social sciences have been explaining the imaginary world of the scientists. In economics, homo economicus plays the leading role in the imaginary world of economists. However, recently this dream world of economists has been greatly distressed with the development of behavioral economics. Behavioral economics has opened the door for real world investigations not only for economics but also for other social science disciplines. So today is the right time to talk about the reality of religion and economics. In fact, for defending an idea, generally the righteousness of the time is more important than the righteousness of the idea itself. This study is prepared in order to make emphasis on the complementary relationship between religion and science in broad terms but specifically between Islam and economics. With a historical point of view, this study bases the main idea on three hypotheses from three books. First book is Frank M. Turner’s European Intellectual History. Second hypothesis is depended on the Tomas Sedlacek’s Economics of Good and Evil. Last but not least book is the Fukuyama’s End of History and the Last Man. At the final part of the study, based on these three hypotheses, there will be suggested Islamic solutions for behavioral problems in economics.
https://ier.ut.ac.ir/article_86973_a0b84ddd1de11fd5ab3e4c284bec9cb9.pdf
2022-03-01
109
119
10.22059/ier.2022.86973
Islamic Economy
Homo Economicus
behavioral economics
Tyhmos
Neoclassical
Mehmet
Çanakcı
mehmet.canakci@inonu.edu.tr
1
Department of Public Finance, Inonu University, Malatya, Turkey
LEAD_AUTHOR
Mustafa
Kılıc
mercan.kilic@inonu.edu.tr
2
Department of Economics Faculty of Economics and Public Administration İnonu University
AUTHOR
Ariely, D. (2008). Predictably Irrational.New York: Harper Collins.
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41
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42
ORIGINAL_ARTICLE
Migrant Remittances and Dutch Disease: Evidence from India
This study deals with the question of whether the inflow of migrant remittances causes Dutch Disease or not in India. For this purpose, the study employs the Autoregressive Distributed Lag Model (ARDL) to examine the influence of migrant remittances on the real effective exchange rate spanning the period from 1975 to 2018. In the long run, the study finds a positive relationship between migrants’ remittances and the real effective exchange rate, meaning that evidence of Dutch Disease risk in India. The study also checks the moderating effect of inflation on remittances and real effective exchange rate relationship and finds a negative effect. The study recommends that the government of India would implement and design the policies for the diversification of remittances flow toward priority areas of investment.
https://ier.ut.ac.ir/article_86974_b146f4ebf563173247d7fd241767a5ea.pdf
2022-03-01
121
132
10.22059/ier.2022.86974
Migrant Remittances
Dutch Disease
ARDL
India
Muhammad
Faheem
faheem@bzu.edu.pk
1
Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, Serdang, Malaysia
LEAD_AUTHOR
Mohamed
Azali
azali@upm.edu.my
2
Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, Serdang, Malaysia
AUTHOR
Lee
Chin
leechin@upm.edu.my
3
Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, Serdang, Malaysia
AUTHOR
Nur Syazwani
Mazlan
nur.syazwani@upm.edu.my
4
Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, Serdang, Malaysia
AUTHOR
Acosta, P. A., Lartey, E. K., & Mandelman, F. S. (2009). Remittances and the Dutch Disease. Journal of International Economics, 79(1), 102-116.
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71
ORIGINAL_ARTICLE
Comparing the Volatility Spillovers among Financial Markets in Iran pre and post JCPOA: A VAR-BEKK-GARCH Approach
Volatility spillovers among financial markets suggest some sort of information transmission between these markets. The present article uses VAR-BEKK-GARCH approach to investigate volatility spillovers among financial markets in Iran, including stock, foreign exchange and gold markets pre and post JCPOA. To compare volatility spillover among financial markets, the data analyzed were associated with two periods, one pre-JCPOA, i.e. 25 March 2009 to 13 July 2015, and the other post-JCPOA, i.e. 15 July 2015 to 18 July 2018. Moreover, the impulse-response functions were calculated by including the asymmetric volatility spillover of error terms in MGARCH-type equations. Comparing the results obtained from estimating the model confirmed two-way volatility spillover between gold and stock markets in both of the periods, two-way volatility spillover between foreign exchange and stock markets, one-way volatility spillover from gold to foreign exchange markets in the per-JCPOA period, two-way spillover between foreign exchange and gold markets and one-way spillover from stock to foreign exchange markets in the post-JCPOA period. In addition, the effect of volatility spillover from stock to foreign exchange markets was negative in the per-JCPOA period and positive in the post-JCPOA period, and volatility spillovers between financial markets significantly decreased in post JCPOA period. The results of impulse-response functions also confirmed a reduction in the transmission of uncertainty among financial markets in Iran in the post-JCPOA period.
https://ier.ut.ac.ir/article_86975_09ba066b015675ab35851ea60598aa41.pdf
2022-03-01
133
146
10.22059/ier.2022.86975
Volatility spillover
Financial markets
VAR-BEKK-GARCH Approach
JCPOA
Vahid
Dehbashi
vahideconomy@gmail.com
1
Department of Economics, Allameh Tabataba’i University, Tehran, Iran; Department of Economics, Zabol University, Zabol, Iran
AUTHOR
Teymour
Mohammadi
mohammadi@atu.ac.ir
2
Department of Economics, Allameh Tabataba’i University, Tehran, Iran
LEAD_AUTHOR
Javid
Bahrami
javid_bahrami@yahoo.com
3
Department of Economics, Allameh Tabataba’i University, Tehran, Iran
AUTHOR
Abbas
Shakeri
shakeri.abbas@gmail.com
4
Department of Economics, Allameh Tabataba’i University, Tehran, Iran
AUTHOR
Aboura, S., & Chevallierm, J. (2014). Cross-Market Spillovers with Volatility Surprise. Review of Financial Economics, 23(14), 194-207.
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4
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5
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14
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15
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17
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18
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19
MartinV L. V., Hurn, S., & Harris, D. (2012). Econometric Modeling with Time Series: Specification, Estimation and Testing, Themes in Modern Econometrics. New York: Cambridge University Press.
20
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23
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24
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25
Wang, K. M., Lee, Y. M., & Nguyen, T. (2011). Time and Place Where Gold Acts as an Inflation Hedge: An Application of Long-run and Short-run Threshold Model. Economic Modelling, 28, 806–819.
26
ORIGINAL_ARTICLE
Poverty Risk, Inequality Decomposition and Educational Level of Household Heads
This study aims to investigate poverty risk and inequality decomposition based on the education level of Iranian urban household heads in 2017. A logistic regression model is estimated with the poverty status of households as a dependent variable, a set of control variables (gender and age), and the education level of household heads as explanatory variables. We also use the Gini decomposition as appropriate inequality decomposition for selected provinces. These provinces are categorized based on whether they are deprived or non-deprived provinces using the Council of Ministers guidelines. The findings show that the poverty risk of families in both deprived and non-deprived provinces as well as the country as a whole decrease when the education level of the household head increases. The marginal effect of the first level of education is higher than other levels. Therefore, one can conclude that Iran is more similar to less developed countries. We also show that being a male household head reduces the poverty risk of families in Iran, but the gender of household heads has no significant effect in the selected provinces. In addition, the poverty risk in higher age groups is lower than that of other age groups. Based on the Gini decomposition reports, the highest level of inequality is observed in Sistan and Baloochestan province which suffers from the highest level of unemployment and illiteracy rates in Iran. Finally, inequality decomposition confirms the crucial role of education in explaining inequality.
https://ier.ut.ac.ir/article_86976_470d9ceba4dddafbb9707888f93d2554.pdf
2022-03-01
147
159
10.22059/ier.2022.86976
Poverty Risk
Education
inequality decomposition
Logistic regression
Iran
Reza
Najarzadeh
najarzar@modares.ac.ir
1
Department of Economics, Tarbiat Modares University, Tehran, Iran
LEAD_AUTHOR
Alireza
Keikha
alirezakeikha@modares.ac.ir
2
Department of Economics, Tarbiat Modares University, Tehran, Iran
AUTHOR
Hassan
Heidari
hassan.heydari@modares.ac.ir
3
Department of Economics, Tarbiat Modares University, Tehran, Iran
AUTHOR
Akita, T., Kurniawan, P. A., & Miyata, S. (2011). Structural Changes and Regional Income Inequality in Indonesia: A Bidimensional Decomposition Analysis. Asian Economic Journal, 25(1), 55–77.
1
Alborz, M., Eftekhari, S., & Ganjali, M. (2009). Determinant Factors of Poverty Risk Using Multinomial Logistic Regression. Social Welfare, 6(24), 125–139.
2
Attanasio, O. P., & Pistaferri, L. (2016). Consumption Inequality. Journal of Economic Perspective, 30(2), 3–28.
3
Attanasio, O., & Pistaferri, L. (2014). Consumption Inequality Over the Last Half Century: Some Evidence Using the New PSID Consumption Measure. The American Economic Review, 104(5), 122–126.
4
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5
Barro, R. J. (2000). Inequality and Growth in a Panel of Countries. Journal of Economic Growth, 5(1), 5–32.
6
Berg, A., Ostry, J. D., Tsangarides, C. G., & Yakhshilikov, Y. (2018). Redistribution, Inequality, and Growth: New Evidence. Journal of Economic Growth, 23(3), 259–305.
7
Berg, A., Ostry, J. D., & Zettelmeyer, J. (2012). What Makes Growth Sustained? Journal of Development Economics, 98(2), 149–166.
8
Bilenkisi, F., Sami Gungor, M., & Tapsin, G. (2015). The Impact of Household Heads ’ Education Levels on the Poverty Risk : The Evidence from Turkey. Educational Sciences: Theory & Practice, 15(2), 337–348.
9
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10
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11
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24
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29
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33
ORIGINAL_ARTICLE
Remittances, Exchange Rates and Dutch Disease in Sub-Saharan Africa
This study empirically investigated remittances’ short-run and long-run effects on actual exchange rates. Further, it examined the impact of remittances on resource movement from the tradable to the nontradable sector in the CFA franc and non-CFA zones of sub-Saharan Africa (SSA). A panel-based, Pooled Mean Group estimation technique was adopted to estimate the data collected from 1981 to 2018 for 26 SSA countries which comprise 15 non-CFA and 11 CFA countries. Both aggregate (SSA) and disaggregated (CFA franc and non-CFA) analyses were conducted. The data utilized were collected from the World Bank’s World Development Indicator and International Monetary Fund’s International Financial Statistics database. Evidence from the results indicated that remittances inflow led to real exchange rate appreciation in the CFA zone. However, the effect of remittances on the real exchange rate in the non-CFA zone is not statistically significant. Moreover, while remittances caused a shift of resources from tradable to nontradable sector in the CFA zone, in the long run, there is no substantial evidence that remittances would lead to resource movement from tradable to nontradable sector in the non-CFA zone. Thus, in the CFA zone, effective policies need to be implemented to channel remittances towards investment in agriculture and industry (tradable sector) to reduce the negative impact of remittances in the industry.
https://ier.ut.ac.ir/article_86977_8355b1a9a0219616b38c5016170f8b97.pdf
2022-03-01
161
181
10.22059/ier.2022.86977
Remittances
Dutch Disease
CFA
Non-CFA
Pooled Mean Group
Dayo
Benedict Olanipekun
dayo.olanipekun@eksu.edu.ng
1
a. Department of Economics, Ekiti State University, Ado-Ekiti, Ekiti State, Nigeria
LEAD_AUTHOR
Acosta, P.A., Baerg, N., & Mandelman, F. (2009). Financial Development, Remittances and Real Exchange Rate Appreciation. Federal Reserve Bank of Atlanta Economic Review, 94(1), 1-12.
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Calderon, C., Fajnzylber, P., & Lopez, H. (2008). What is the Impact of International Remittances on Poverty and Inequality in Latin America? World Development, 36(1), 89-114.
2
Lartey, E. K. K., & Mandelman, F. S. (2007). Remittances and the Dutch Disease. Federal Reserve Bank of Atlanta Working Paper, 2007-8a, Retrieved from https://www.econstor.eu/bitstream/10419/70606/1/572362153.pdf
3
African Economic Outlook. (2016). Sustainable Cities and Structural Transformation. Abidjan: African Development Bank Group.
4
Aggarwal, R., Demirguc-Kunt, A., & Peria, M. S. M. (2011). Do Remittances Promote Financial Development? Journal of Development Economics, 96(2), 255-264.
5
Anyanwu, J. C., & Erhijakpor, A. E. O. (2010). Do International Remittances Affect Poverty in Africa? African Development Review, 22(1), 51-91.
6
Ball, C., Lopez, C., Reyes, J., & Cruz-Zuniga, M. (2010). Remittances, Inflation and Exchange Rate Regimes in Small Open Economies. MPRA Paper, 22648, Retrieved from http://mpra.ub.uni-muenchen.de/22648
7
Barajas, A., Chami, R., Hakura, D., Montel, P., & Tressel, T. (2011). Workers’ Remittances and Equilibrium Real Exchange Rate: Theory and evidence. IMF Working Paper, Retrieved from https://www.imf.org/external/pubs/ft/wp/2010/wp10287.pdf
8
Barret, K. (2012). The Effect of Remittances on the Real Exchange Rate Nexus: The US-Mexico Case. Journal of Developing Areas, 47(1), 63-74.
9
Betti, G., & Lundgren, L. (2012). The Impact of Remittances and Equivalence Scales on Poverty in Tajikistan. Central Asian Survey, 31(4), 395-408.
10
Beyene, B. M. (2012). The Effects of International Remittances on Poverty and Inequality in Ethiopia. Memorandum, 13/2012, Retrieved from https://ideas.repec.org/p/hhs/osloec/2012_013.html
11
Brahim, M., Nefzi, N., & Sambo, H. (2017). Remittances and the Real Effective Exchange Rates in MENA Countries: What is the Long Run Impact? Retrieved from https://hal.archives-ouvetes.fr/hal-01583564
12
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13
Brown, R. P. C., Carmignani, F., & Fayad, G. (2013). Migrants’ Remittances and Financial Development: Macro and Micro-Level Evidence of Perverse Relationship. The World Economy, Retrieved from https://doi.org/10.1111/twec.12016
14
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15
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17
Dadgar, Y., & Orooji, Z. (2020). Dutch Disease, Rentier State and Resource Curse: A Characteristic Triangle and Ultra Challenge in the Iranian Economy. Iranian Economic Review, 24(1), 129-157.
18
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19
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20
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21
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22
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Lartey, E. K. K., Mandelman, F. S., & Acosta, P. A. (2012). Remittances, Exchange Rate Regimes and the Dutch Disease: A Panel Data Analysis. Review of International Economics, 20(2), 377-395.
24
---------- (2013). Remittances, Investment and Growth in Sub-Saharan Africa. The Journal of International Trade and Economic Development, 22(7), 1038-1058.
25
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26
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28
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33
Ojapinwa, T. V., & Nwokoma, N. I. (2018). Workers’ Remittances and the Dutch-Disease Argument: Investigating the Relationship in Sub-Saharan Africa. African Development Review, 30(3), 316-324.
34
Pesaran, M. H., Shin, Y., & Smith, R. P. (1999). Pooled Mean Group Estimation of Dynamic Heterogenous Panels. Journal of the American Statistical Association, 94(446), 621-634.
35
Portes, L. S. V. (2009). Remittances, Poverty and Inequality. Journal of Economic Development, 34(1), 127-140.
36
Rahman, M., Foshee, A., & Mustafa, M. (2013). Remittances-Exchange Rate Nexus: The U.S-Mexico Case. The Journal of Developing Areas, 47(1), 63-74.
37
Rao, B. B., & Hassan, G. (2009). A Panel Data Analysis of the Growth Effects of Remittances. Munich Personal Repec Archive, MPRA, 18021, Retrieved from http://mpra.ub.uni-muenchen.de/18021
38
Ratta, D. (2003). Workers’ Remittances: An Important and Stable Source of External Development Finance. Global Development Finance, Retrieved from https://ssrn.com/abstract=3201568
39
Serino, M. N. V., & Kim, D. (2011). How Do International Remittances Affect Poverty in Developing Countries? A Quantile Regression Analysis. Journal of Economic Development, 36(4), 17-40.
40
Singer, D. A. (2010). Migrant Remittances and Exchange Rate Regimes in the Developing World. American Political Science Review, 104(2), 307-323.
41
World Bank. (2019). World Development Indicator. Washington, DC: World Bank Group.
42
---------- (2016). World Development Indicator. Washington, DC: World Bank Group.
43
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44
ORIGINAL_ARTICLE
The Twin Crises in the Iranian Economy and Its Determination during 1980–2018
The coincidence of banking and currency crises since the 1990s has attracted the attention of many economists to the causal relationship between them. The current paper aims to determine the potential indicators of banking and currency crises and their causality in the Iranian economy during 1980–2018. For this purpose, we first study the different developments in the Iranian economy over the last four decades. Then, two types of variables, including multi-categorical and dummy variables, are extracted from the exchange market pressure index (EMPI) and money market pressure index (MMPI). The empirical results found that the two crises could occur closely together in the same periods. According to the ordered logit and logit model, the results showed that the impact of the currency crises on banking crises was positive and statistically significant. Still, banking crises did not lead to currency crises when banking crises were peroxide as the dependent variable. In addition, the Granger causality test showed some one-way causality from EMPI to MMPI.
https://ier.ut.ac.ir/article_86978_148ff4cd0d59a9c815b9baf9eb859094.pdf
2022-03-01
183
197
10.22059/ier.2022.86978
Banking Crises
Currency Crises
Logit Model
Iranian Economy
Davoud
Mahmoudinia
d.mahmoudinia@vru.ac.ir
1
Department of Economics, Vali-e-Asr University of Rafsanjan , Rafsanjan, Iran
LEAD_AUTHOR
Leyla
Borhani
borhanileyla@gmail.com
2
Department of Economics, Vali-e-Asr University, Rafsanjan, Iran
AUTHOR
Ari, A., & Cergibozan, R. (2016). The Twin Crises: Determinants of Banking and Currency Crises in the Turkish Economy. Emerging Markets Finance & Trade, 52, 123–135.
1
Bauer, C., Herz, B., & Karb, V. (2007). Are Twin Currency and Debt Crises Special? Journal of Financial Stability, 3(1), 59–84.
2
Boonman, T. M., Jacobs, J., & Kuper, G. H. (2012).The Global Financial Crisis and Currency Crises in Latin America. Research Report 12005-EEF, University of Groningen, Research Institute SOM, Retrieved from https://research.rug.nl/files/15133011/12005-EEF_def.pdf
3
Boonman, T. M. (2019). Dating Currency Crises in Emerging Market Economies. The North American Journal of Economics and Finance, 49, 273–286.
4
Bordo, M., Eichengreen, B., Klingebiel, D., & Martinez‐Peria, M. S. (2001). Is the Crisis Problem Growing More Severe? Economic policy, 16(32), 52–82.
5
Demirgüç-Kunt, A., & Detragiache, E. (2005). Cross-Country Empirical Studies of Systemic Bank Distress: A Survey. National Institute Economic Review, 192(1), 68–83.
6
Eichengreen, B., Rose, A. K., & Wyplosz, C. (1996). Exchange Market Mayhem: the Antecedents and Aftermath of Speculative Attacks. Economic Policy, 21, 249-312.
7
Eichengreen, B., & Rose, A. K. (1999). Contagious Currency Crises: Channels of Conveyance. Changes in Exchange Rates in Rapidly Developing Countries: Theory, Practice, and Policy Issues (NBER-EASE, 7). Chicago: University of Chicago Press.
8
Eijffinger, S. C., & Karataş, B. (2019). Together or Apart? The Relationship between Currency and Banking Crises. Journal of Banking & Finance, 119, Retrieved from https://www.sciencedirect.com/science/article/abs/pii/S0378426619302067
9
Falcetti, E., & Tudela, M. (2008). What Do Twins Share? A Joint Probit Estimation of Banking and Currency Crises. Economica, 75(298), 199–221.
10
Filippopoulou, C., Galariotis, M., & Spyrou, S. (2020). An Early Warning System for Predicting Systemic Banking Crises in the Eurozone: A Logit Regression Approach. Journal of Economic Behavior and Organization, 172, 344–363.
11
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12
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13
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14
Hutchison, M., & Noy, I. (2005). How Bad Are Twins? Output Costs of Currency and Banking Crises. Journal of Money, credit and Banking, 37, 725–752.
15
IMF. (1998). Financial Crises: Characteristics and Indicators of Vulnerability. IMF Working Paper, Retrieved from International Monetary Fund.
16
Jing, Z. (2015). On the Relation between Currency and Banking Crises in Developing Countries, 1980–2010. The North American Journal of Economics and Finance, 34, 267–291.
17
Kaminsky, G. L., & Reinhart, C. M. (1999). The Twin Crises: The Causes of Banking and Balance-of-Payments Problems. American Economic Review, 89(3), 473–500.
18
Laeven, L., & Valencia, F. (2018). Systemic Banking Crises Revisited. IMF Working Paper, 18/206, Retrieved from International Monetary Fund.
19
---------- (2013). Systemic Banking Crises Database. IMF Economic Review, 61(2), 225–270.
20
---------- (2008). Systemic Banking Crises: A New Database. Washington, DC: International Monetary Fund.
21
Mahmoudinia, D. (2019). Central Bank Monetary Policy and Its Role in the Emergence of Banking Crises in the Iranian Economy within Modified Money Market Pressure Index. Quarterly Journal of Economic Research and Policies, 27(89), 61–97 (In Persian).
22
Mariano, R. S., Gultekin, B. N., Ozmucur, S., Shabbir, T., & Alper, C. E. (2004). Prediction of Currency Crises: Case of Turkey. Review of Middle East Economics and Finance, 2(2), 87–107.
23
Miller, V. (1999). The Timing and Size of Bank-Financed Speculative Attacks. Journal of International Money and Finance, 18(3), 459–470.
24
Mishkin, F. S. (1996). Understanding Financial Crises: A Developing Country Perspective (29–62). In Bruno and B. Pleskovic (Eds.), Annual World Bank Conference on Development Economics. Retrieved from https://www.nber.org/system/files/working_papers/w5600/w5600.pdf
25
Moshiri, S., & Nadali, M. (2013). The Determinants of Banking Crises in Iranian. Journal of Economic Research, 13(48), 1–27 (In Persian).
26
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27
Obstfeld, M. (1995). The Logic of Currency Crises (62–90). In Monetary and Fiscal Policy in an Integrated Europe. Berlin, Heidelberg: Springer.
28
Rossi, M. M. (1999). Financial Fragility and Economic Performance in Developing Economies: Do Capital Controls, Prudential Regulation and Supervision Matter? Washington, DC: International Monetary Fund.
29
Velasco, A. (1987). Financial Crises and Balance of Payments Crises: A Simple Model of the Southern Cone Journal of Development Economics, 27, 263–283.
30
Von Hagen, J., & Ho, T. (2007). Money Market Pressure and the Determinants of Banking Crises. Journal of Money, Credit and Banking, 39(5), 1037–1066.
31
Von Hagen, J., & Ho, T. (2003). Twin Crises: A Reexamination of Empirical Links. 6th Annual Conference on Global Economic Analysis. Amsterdam: The Hague.
32
Yavary, K., Najarzadeh, R., & Mehregan, N. (2019). Investigation of Currency Crises Incidence in the Iranian Economy. Iranian Journal of Trade studies, 23(90), 1–23 (In Persian).
33
Zarei, Z.,& Komijani, A. (2015). Identification and Prediction of Banking Crises in Iran. Economic Modelling, 9(1), 1–23 (In Persian).
34
ORIGINAL_ARTICLE
Non-Linear Effects of Government Size on Inflation in OPEC Countries: A Threshold Panel Approach
The purpose of this paper is to consider the relationship between inflation and government size in OPEC countries during the period 2000-2015. Estimation results from different linear panel models with quadratic form of government size and non-linear panel models including static and dynamic panel threshold models suggest that there is a non-linear relationship between government size and the inflation rate in these countries. The threshold value of government size is estimated as 17.76% for all the threshold panel models with different control variables. Below this threshold value, an increase in government size has a significant negative impact on the inflation rate. When government size grows larger, an increasing government size has a significant positive impact on the inflation rate. This paper suggests that it is possible to explain the contradictory evidence of previous studies by making use of a non-linear model.
https://ier.ut.ac.ir/article_86979_b4302fa829b4e8c8785204c0c785c84d.pdf
2022-03-01
199
214
10.22059/ier.2022.86979
Inflation
Government Size
Threshold Panel Models
OPEC Countries
Younes
Nademi
younesnademi@abru.ac.ir
1
Department of Economics, Ayatollah Boroujerdi University, Boroujerd, Iran
LEAD_AUTHOR
Peter
Winker
peter.winker@wirtschaft.uni-giessen.de
2
Department of Economics, Justus-Liebig-University Giessen, Giessen, Germany
AUTHOR
Abounoori, E., & Nademi, Y. (2010). Government Size Threshold and Economic Growth in Iran. International Journal of Business and Development Studies, 2(1), 95-108.
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Arellano, M., & Bond, S. (1991). Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations. The Review of Economic Studies, 58(2), 277-297.
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Armey, R. K. (1995). The Freedom Revolution: The New Republican House Majority Leader Tells Why Big Government Failed, Why Freedom Works, and How We Will Rebuild America, Regnery Pub. Retrieved from https://www.amazon.com/Freedom-Revolution-Republican-Majority-Government/dp/0895264692
3
Campillo, M., & Miron, J. A. (1997). Why does Inflation Differ across Countries? (335-362). In Reducing Inflation: Motivation and Strategy. Chicago: University of Chicago Press.
4
Chan, K. S. (1993). Consistency and Limiting Distribution of the Least Squares Estimator of a Threshold Autoregressive Model. The Annals of Statistics, 21(1), 520-533.
5
Chen, S. T., & Lee, C. C. (2005). Government Size and Economic Growth in Taiwan: A Threshold Regression Approach. Journal of Policy Modeling, 27(9), 1051-1066.
6
Choi, I. (2001). Unit Root Tests for Panel Data. Journal of International Money and Finance, 20(2), 249-272.
7
Dar, A. A., & AmirKhalkhali, S. (2002). Government Size, Factor Accumulation, and Economic Growth: Evidence from OECD Countries. Journal of Policy Modeling, 24(7), 679-692.
8
Engen, E. M., & Skinner, J. (1992). Fiscal Policy and Economic Growth (w4223). National Bureau of Economic Research, 50, 617-642.
9
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Han, S., & Mulligan, C. B. (2008). Inflation and the Size of Government. Review-Federal Reserve Bank of Saint Louis, 90(3), 245-268.
12
Hansen, B. E. (2000). Sample Splitting and Threshold Estimation. Econometrica, 68(3), 575-603.
13
---------- (1999). Threshold Effects in Non-dynamic Panels: Estimation, Testing, and Inference. Journal of Econometrics, 93(2), 345-368.
14
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---------- (1996). Inference when a Nuisance Parameter is not identified under the Null Hypothesis. Econometrica, 64(2), 413-430.
16
Jafari-Samimi, A., Nademi, Y., Ghaderi, S., & Hosseinzadeh, R. (2012). Inflation and Inflation Tax in Developing Countries; A Panel Threshold Approach. International Journal of Academic Research in Economics and Management Sciences, 1(1), 82-88.
17
Klein, N., & Kyei, A. (2009). Understanding Inflation Inertia in Angola (9-98). Retrieved from International Monetary Fund.
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Kock, U., & Grigorian, M. D. A. (2010). Inflation and Conflict in Iraq: The Economics of Shortages Revisited (10-159). Retrieved from International Monetary Fund.
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Kormendi, R. C., & Meguire, P. (1986). Government Debt, Government Spending, and Private Sector Behavior: Reply. The American Economic Review, 76(5), 1180-1187.
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Landau, D. (1983). Government Expenditure and Economic Growth: a Cross-country Study. Southern Economic Journal, 49(3), 783-792.
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Levin, A., Lin, C. F., & Chu, C. S. J. (2002). Unit Root Tests in Panel Data: Asymptotic and Finite-sample Properties. Journal of Econometrics, 108(1), 1-24.
22
Maddala, G. S., & Wu, S. (1999). A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test. Oxford Bulletin of Economics and Statistics, 61(S1), 631-652.
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Mishkin, F. S. (2007). The Economics of Money, Banking, and Financial Markets. Boston: Pearson Education.
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Ram, R. (1986). Government Size and Economic Growth: A New Framework and Some Evidence from Cross-section and Time-series Data. The American Economic Review, 76(1), 191-203.
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26
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27
ORIGINAL_ARTICLE
An Analysis of the Relationship between Bilateral Trade and Labor Force Immigration Considering the Role of Financial Crises (Banking and Sovereign Debt Crises)
Economists have always noticed the immigration of laborers since it can change the economy of countries. In the literature of international economics, labor force immigration is studied by the mobility of factors of production and trade. In this case, empirical studies have found substitutive and complementary relationships between the two, which necessitate consideration of other elements influencing this relationship. One of the phenomena that can affect both labor force immigration and bilateral trade is the countries' financial crises. Therefore, this study analyzes the parametric effect of bilateral trade and the nonparametric impact of economic crises on labor force immigration in the Middle East and OECD countries from 1995 to 2017. For this purpose, two indices of banking market pressure and debt market pressure have been used to study financial crises such as banking crises and sovereign debt crises, and the semi-parametric gravity model of immigration has been estimated by using random effects. The estimation results show a substitution relationship between bilateral trade and labor force immigration, and both types of mentioned financial crises have a nonparametric impact on immigration. So that the effect of these two types of economic crises on labor force immigration has been upward for some periods and downward for other periods. Moreover, these financial crises have reduced the labor force immigration among business partners. In other words, there has been a nonlinear relationship between the two financial crises.
https://ier.ut.ac.ir/article_86981_7a7ce03086b87c602d4ea0c4efe6e32b.pdf
2022-03-01
215
235
10.22059/ier.2022.86981
Banking Financial Crises
Bilateral Trade
Labor Force Immigration
Semi-Parametric Analysis
Sovereign Debt Crises
Mostafa
Mobini Dehkordi
mostafa.dehkordi@gmail.com
1
Department of Economics, University of Isfahan, Isfahan, Iran
AUTHOR
Karim
Azarbayjani
k_azarbayjani@ase.ui.ac.ir
2
Department of Economics, University of Isfahan, Isfahan, Iran
LEAD_AUTHOR
Khadije
Nasrollahi
kh.nasrollahi@ase.ui.ac.ir
3
Department of Economics, University of Isfahan, Isfahan, Iran
AUTHOR
Seyed Komeil
Tayebi
sk.tayebi@ase.ui.ac.ir
4
Department of Economics, University of Isfahan, Isfahan, Iran
AUTHOR
Acharyya, R., Beladi, H., & Kar, S. (2019). Trade, Migration Costs and Asymmetric Migration Patterns. The World Economy, 42(9), 2629-2648.
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ORIGINAL_ARTICLE
Financial Development, Trade Openness, and Economic Growth in Nigeria
This study examined the impact of financial liberalization and trade openness as well as their interactive effects on the growth of the Nigerian economy using annual time-series data for the period, 1981 to 2018. The results of the Augmented Dickey-Fuller (ADF) unit root test show that all the variables are stationary at the first difference and the Johansen cointegration test results confirm the existence of a long-run relationship among the variables in the model. Two equations were specified and estimated using the dynamic ordinary least square (DOLS) estimation technique and the granger causality test was carried out. The results reveal that financial development, exchange rate, and interest rate spread have a significant influence on real GDP in Nigeria while trade openness, as well as its interaction with financial development, do not exert any significant impact on economic growth in Nigeria. Further, this study supports the demand-following and trade-led growth hypotheses. Hence, this study recommends the design and implementation of a policy framework geared towards enhancing the intermediation efforts and deposit mobilization of the financial sector that would instigate the integration of the sector with the various productive sectors of the Nigerian economy and that trade performance in the country to be improved through economic diversification so as to boost exports, raise the country competitiveness and increase her national output.
https://ier.ut.ac.ir/article_86982_37f516f0ce4d55185ffde8319c09d65a.pdf
2022-03-01
237
254
10.22059/ier.2022.86982
Financial Development
Trade openness
economic growth
Dynamic OLS
Nigeria
Joshua
Afolabi
j.ogunjimi@niser.gov.ng
1
Nigerian Institute of Social and Economic Research (NISER), Ibadan, Nigeria
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