ORIGINAL_ARTICLE
Patterns and Trends in Sovereign Wealth Fund Investments: A Post-Crisis Descriptive Analysis
A
nalyzing more than 9,400 investment transactions performed by 32 sovereign wealth funds (SWFs), from 23 countries, and targeted towards 77 countries, between 2010 and 2013, this study highlights some of the most important visible patterns and nuances in SWF investments. First, lion’s share of SWF investments are cross-border transactions that originated from and targeted towards high-income economies, while SWFs from emerging economies (mainly China) are also becoming important players in the global capital markets. Second, the most popular sectors are the financial and the real estate sectors mainly because of their more liquid nature and the energy sector for its strategic importance. Finally, domestic investments are relatively more popular among non-commodity based SWFs in comparison to commodity based SWFs. The results also show that while infrastructure investments are in line with the time horizon of SWF investments and their objectives, only five percent of SWF investments were targeted toward the infrastructure sector.
https://ier.ut.ac.ir/article_64079_4f40e174d0225a0db36af11dc8d04128.pdf
2017-12-01
725
763
10.22059/ier.2017.64079
Keywords: Sovereign Wealth Fund
Investment
Financial Industry
Real Estate
Oil
Gas. JEL Classification: G23
E22
F21
Amin
Mohseni-Cheraghlou
amohseni@ut.ac.ir
1
University of Tehran Faculty of Economics
LEAD_AUTHOR
Anderloni, L., & Vandone, D. (2012). Sovereign Wealth Fund Investments in the Banking Industry. Working Paper, 2012-24, Retrieved from http://wp.demm.unimi.it/files/wp/2012/DEMM-2012_024wp.pdf.
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ORIGINAL_ARTICLE
Regional Economic Growth and Spatial Spillover Effects in MENA Area
T
he main objective of this study is to estimate the spatial spillover effects of the economic growth among the selected countries of MENA region. For this purpose, the Spatial Durbin Model in the framework of spatial dynamic panel data was estimated during the period of 1970-2010. The spatial Diagnostic tests affirmed the occurrence of spatial positive autocorrelation phenomenon for the real per capita income. The obtained results indicated the positive spatial spillover of the economic growth among the MENA countries and the spatial elasticity of per capita GDP was estimated 0.39 percent. Also, according to visualization results, Iran has been surrounded by countries with high per capita income; so opportunity to benefit through the creation of artificial growth poles and economic collaboration with their adjacent countries is available for Iran. Other policy implications are discussed.
https://ier.ut.ac.ir/article_64080_4b5668039637ec154da49de243e40513.pdf
2017-12-01
765
787
10.22059/ier.2017.64080
Keywords: Real Per Capita GDP
convergence
Regional Spillover
MENA. JEL Classification: R12
O47
O33
Allah Morad
Seif
seif.1338@gmail.com
1
Imam Hussein Comprehensive University
AUTHOR
Hossein
Panahi
panahi@tabrizu.ac.ir
2
Tabriz University
AUTHOR
Davoud
Hamidi Razi
d.hamidi@tabrizu.ac.ir
3
Department of Economics, Tabriz University, Tabriz, Iran
LEAD_AUTHOR
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4
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50
ORIGINAL_ARTICLE
Economic Growth and Renewable Energy in Iran
Energy plays an active role in sustainable development in Iran, both in the sustainable and the development aspects. This study aims to estimate the nexus of economic growth and the renewable energy in Iran during 1981-2012. We employ the Auto-Regressive Distributed Lag (ARDL) model to estimate a log-linear equation. The results suggest that renewable energy consumption is an insignificant driver to economic growth in Iran, accepting the neutrality hypothesis, despite the significantly corresponding effects of capital and labor force. Although Iran concentrates mainly on the non-renewable energies such as oil and gas, it has a high spare-capacity in the renewable energy field. It can be rooted in the focus of governors on the fossil fuel energies rather than the renewable ones. It leads to the negligible nexus of renewable energy and economic growth. In Iran, renewable energy has a passive role in economic growth both quantitatively and qualitatively. The governors should promote this kind of energy to assign a large part of total energy consumption to it.
https://ier.ut.ac.ir/article_64081_003a85369117481e094c1efe5f861560.pdf
2017-12-01
789
808
10.22059/ier.2017.64081
Keywords: Renewable Energy
economic growth
Iran
ARDL. JEL Classification: Q21
Q28
Q43
Vahid
Mohamad Taghvaee
v.taghvaee@modares.ac.ir
1
Department of Economic Development and Planning, Faculty of Management and Economics, Tarbiat Modares University
AUTHOR
Jalil
Khodaparast Shirazi
jkshirazi@iaushiraz.ac.ir
2
Department of Economics, Shiraz Branch, Islamic Azad University, Shiraz, Iran
LEAD_AUTHOR
Mohamed Amine
Boutabba
mohamedamine.boutabba@univ-evry.fr
3
EPEE, Univ Evry, Université Paris-Saclay, 91025, Evry, France
AUTHOR
Alireza
Seifi Aloo
a.seifi@stu.umz.ac.ir
4
University of Mazandaran, Babolsar, Iran
AUTHOR
Alper, A., & Oguz, O. (2016). The Role of Renewable Energy Consumption in Economic Growth : Evidence from Asymetric Causality. Renewable and Sustainabile Energy Review, 60, 953-959.
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3
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4
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5
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6
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7
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8
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10
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11
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17
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18
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23
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24
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25
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26
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27
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28
Taghvaee, V. M., & Hajiani, P. (2014). Price and Income Elasticities of Gasoline Demand in Iran : Using Static, ECM, and Dynamic Models in Short, Intermediate, and Long Run. Modern Economy, 5, 939-950.
29
Taghvaee, V. M., & Parsa, H. (2015). Economic Growth and Environmental Pollution in Iran: Evidence from Manufactureing and Services Sectors. Custos E Agronegocio, 11(1), 115-127.
30
Taghvaee, V. M., Mavuka, C., & Shirazi, J. K. (2017). Economic Growth and Energy Consumption in Iran: An ARDL Approach Including Renewable and Non-Renewable Energies. Environment, Development and Sustainability, 19(6), 2405-2420.
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36
ORIGINAL_ARTICLE
The Interactive Relationship between Regional Trade Integration and Foreign Direct Investment
E
conomic integration among countries has continued to deepen over the past decade. This is especially visible at the regional level, with the escalation of Regional Integration Agreements (RIAs) ranging from Free Trade Areas (FTAs) to Customs Unions (CUs). Nowadays, many developing countries have entered a new regional integration agreement with developed and developing countries. Since international trade and Foreign Direct Investment (FDI) are generally recognized as the two main channels of economic integration, the common question is whether international trade and FDI act as complements or substitutes. This paper tries to examine the interaction between trade integration and FDI in Iran, and provide an empirical assessment of the complementarity or substituting relationship between trade and FDI. We consider Iran bilateral trade as integration variable, with selected countries in EU, ASEAN+3, ECO and D8, by using 2SLS estimators within the period 1994–2014. Results indicate that the bilateral manufacturing export and foreign direct investment have a significant direct relationship with each other in Iran. Also, economic similarities with ECO and D8 have higher effect on both export and FDI.
https://ier.ut.ac.ir/article_64082_4253e3f0c1b5b06fe4c8137fbe3eac20.pdf
2017-12-01
809
828
10.22059/ier.2017.64082
Keywords: Foreign Direct Investment
Regional Trade Integration
Economic Similarity
Bilateral Manufacturing Export. JEL Classification: F13
F23
F30
Monireh
Rafat
m.rafat@ase.ui.ac.ir
1
Department of Economics, University of Isfahan, Isfahan, Iran
LEAD_AUTHOR
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46
ORIGINAL_ARTICLE
Exploring the Trade Openness, Energy Consumption and Economic Growth Relationship in Iran by Bayer and Hanck Combined Cointegration and Causality Analysis
This paper aims to investigate the direction of causality between economic growth, energy consumption and trade openness in case of Iran for the period 1967–2012. We apply the newly developed combined cointegration test proposed by Bayer and Hanck (2013). Vector Error Correction Model (VECM) is applied to determine the direction of causality between these three variables. The result of Bayer-Hanck cointegration test reveals the existence of cointegration between variables. The causality analysis indicates just a unidirectional causality from energy consumption to trade openness in short run. The long run causality test explores the bidirectional causality between economic growth and energy consumption, and between openness and energy consumption as well as unidirectional Granger causality from openness to economic growth. In addition, we used variance decomposition method and impulse response functions to show the dynamics of these relationships that confirmed low energy efficiency. This paper provides policy makers with insights to design policies for economic growth with a view to energy consumption and trade.
https://ier.ut.ac.ir/article_64083_f0b2e24c1bd6d0dbe0ac20d5f5479146.pdf
2017-12-01
829
845
10.22059/ier.2017.64083
Keywords: Trade Openness
economic growth
Energy consumption
Bayer and Hanck Combined Cointegration. JEL Classification: F43
Q43
Hojat
Parsa
hparsa@pgu.ac.ir
1
Persian Gulf University
LEAD_AUTHOR
Seyyedeh Zahra
Sajjadi
zsajadi@mehr.pgu.ac.ir
2
Department of Economics, Persian Gulf University, Bushehr, Iran
AUTHOR
Abbasian, E., Nazari, M., & Nasrindoost, M. (2010). Energy Consumption and Economic Growth in the Iranian Economy: Testing the Causality Relationship. Middle-East Journal of Scientific Research, 5, 374-381.
1
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2
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3
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4
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7
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8
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39
ORIGINAL_ARTICLE
Does Market Potential Matter? Evidence on the Impact of Market Potential on Economic Growth in Iranian Provinces
T
he market potential is an indicator showing the level of market access and national demand for products of a region. The aim of this study is to study the effect of market potential on regional economic growth in 28 Iranian provinces over the years 2001–2011. In order to do that, a model of regional growth was estimated by using Spatial Dynamic Panel Data technique. This technique allows us to control for endogeneity biases. Based on the findings, the market potential has a significant positive impact on economic growth of Iranian provinces. This means that as the regional market of products gets bigger, it will experience a higher economic growth.
https://ier.ut.ac.ir/article_64084_0a16943f0937f31ba18a8939c964b143.pdf
2017-12-01
847
863
10.22059/ier.2017.64084
Keywords: Market Potential
Regional Economic Growth
New Economic Geography Model
Spatial Dynamic Panel Data. JEL Classification: R23
R15
R11
Zahra
Dehghan Shabani
zdehghan@shirazu.ac.ir
1
Assistant Professor, Department of Economics, Shiraz University,shiraz,Iran
LEAD_AUTHOR
Ali Hussein
Samadi
asamadi@rose.shirazu.ac.ir
2
Shiraz University
AUTHOR
Amene
Zare
seyed.ava1390@gmail.com
3
Department of Economics, Faculty of Economics, Management and Social Sciences, Shiraz University, Shiraz, Iran
AUTHOR
Amiti, M., & Cameron, L. (2007). Economic Geography and Wages. Review of Economics a Statistics, 89(1),15-29.
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2
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3
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4
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5
Cambridge Econometrics. (2008). Analysis of the Main Factors of Regional Growth: An in-Depth Study of the Best and Worst Performing European Regions. An Inception Report for the European Commission, DG Regional Policy, Retrieved from
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www.euregionalgrowth.eu/download/Final%20report%20PUBLIC.pdf.
7
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8
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9
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10
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11
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12
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13
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15
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17
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18
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19
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20
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22
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https://ideas.repec.org/a/ris/invreg/0123.html.
24
Martin, P., Mayer, T., & Mayneris, F. (2011). Spatial Concentration and Plant-level Productivity in France. Journal of Urban Economics, 69(2), 182-195.
25
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26
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27
Nakamura. R., & Paul. C. J. (2009). Measuring Agglomeration, Handbook of Regional Growth and Development Theories. Cheltenham: Edward Elgar.
28
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29
Niebuhr, A. (2003). Market Potential and Regional Disparities in Europe. 43rd Congress of the European Regional Science Association (1-22), Retrieved from
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31
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32
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35
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36
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37
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38
ORIGINAL_ARTICLE
The Challenge of Economic Growth and Environmental Protection in Developing Economies
T
he main objective of the present study is to find out a clear answer to the question raised in developing countries, that whether such developing economies could be able to achieve economic growth as well as protect their environment simultaneously or these economies still suffer from a severe conflict between environmental protection and economic growth. So, different categories of developing countries were selected and distinguished as oil-based and non-oil based countries for the period 2001-2012. The panel data regression analysis of the information collected from countries showed that the variables such as renewable energy, population growth and the size of internet users have negative and significant effects on the CO2 emission per unit of GDP, while the share of industrial sector value added has a positive effect on CO2 emission per unit of GDP in all categories. Moreover, the rate of urbanization has a negative effect on CO2 emission per unit of GDP in developing but major oil importer countries.
https://ier.ut.ac.ir/article_64085_18208879a6a70fac50e3bbb062911750.pdf
2017-12-01
865
883
10.22059/ier.2017.64085
Keywords: Developing Economies
environment
Economic Growth
CO2. JEL Classification: E23
Q51
Q53
Hamid
Sepehrdoust
hamidbasu1340@gmail.com
1
Department of Economics, Bu- Ali -Sina University, Hamedan, Iran
LEAD_AUTHOR
Saber
Zamani
zamanisaber@gmail.com
2
Bu-Ali-Sina University
AUTHOR
Ahdi, N. A., Shawkat, H., Duc, K. N., & João, R. S. (2015). On the Relationships between CO2 Emissions, Energy Consumption and Income: The Importance of Time Variation. Journal of Energy Economics, 69(2015), 629-638.
1
Alam, J. (2014). On The Relationship between Economic Growth and CO2 Emissions: The Bangladesh Experience. IOSR Journal of Economics and Finance, 5(6), 36-41.
2
Amiri, S., & Reif, B. (2013). Internet Penetration and Its Correlation to Gross Domestic Product: An Analysis of The Nordic Countries. International Journal of Business, Humanities and Technology, 3, 50-60.
3
Apergis, N., & Danuletiu, D. C. (2014). Renewable Energy and Economic Growth: Evidence from The Sign of Panel Long-Run Causality. International Journal of Energy Economics and Policy, 4, 578-587.
4
Bloom, D. E., Canning, D., & Fink, G. (2008). Urbanization and the Wealth of Nations. PGDA Working Paper, 30, Retrieved from http://core.ac.uk/download/pdf/6534752.pdf.
5
Bolaky, B. A. (2011). The Role of Industrialization in Economic Development: Theory and Evidence. United Nations Conference on Trade and Development (UNCTD), Retrived from
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slideplayer.com/slide/7993067/.
7
Cherniwchan, J. (2012). Economic Growth, Industrialization, and the Environment. Journal of Resource and Energy Economics, 32, 442-467.
8
Chu, S. Y. (2013). Internet, Economic Growth and Recession. Journal of Modern Economy, 4, 209 -213.
9
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35
ORIGINAL_ARTICLE
Back to the Land: The Impact of Financial Inclusion on Agriculture in Nigeria
C
an rural financial inclusion enhance agricultural growth? This study, using annual data over the period 1981-2014 and the ARDL bounds testing approach, captures the long run as well as the short-run dynamics of the relationship between financial inclusion and agriculture in Nigeria. The results show that usage of financial services has significant impacts on agriculture both in the short and the long run, meaning that for sustainable agricultural development in rural areas, improving financial inclusion is critical. On the contrary, access to finance has insignificant impacts on agricultural growth. The message is: While provision of access to finance to rural farmers could have many benefits, it is more important to consider the usage of the finance in the rural settings and its impact on rural outcomes that we care about. There is a need for more traditional and non-traditional financial service providers to go back to the land and innovate in the Nigerian agricultural space in order to boost financial inclusion in Nigeria while also substantially reducing poverty and stimulating agricultural growth.
https://ier.ut.ac.ir/article_64086_74016617c9b22d98af659d586409eaff.pdf
2017-12-01
885
903
10.22059/ier.2017.64086
Keywords: Financial Inclusion
Access to Finance
Usage of Financial Products. JEL Classification: E52
Q14
D53
Evans
Olaniyi
oevans@pau.edu.ng
1
School of Management & Social Sciences, Pan-Atlantic University, Lagos, Nigeria
LEAD_AUTHOR
Acha, I. A. (2012). Non-Bank Financial Institutions and Economic Development in Nigeria. International Journal of Finance and Accounting, 1(2), 14-22.
1
Adeola, O., & Evans, O. (2017a). The Impact of Microfinance on Financial Inclusion in Nigeria. The Journal of Developing Areas, 51(4), 193-206.
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9
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10
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14
Evans, O. & Lawanson, O. (2017) A Multi-Sectoral Study of Financial Inclusion and Economic Output in Nigeria. Ovidius, University Annals, Economic Sciences Series, XVII (1/2017), 195-204.
15
Evans, O. (2016). The Effectiveness of Monetary Policy in Africa: Modeling the Impact of Financial Inclusion. Iranian Economic Review, 20(3), 327-337.
16
---------- (2015). The Effects of Economic and Financial Development on Financial Inclusion in Africa. Review of Economic and Development Studies, 1(I), 17-25.
17
Evans, O., & Adeoye, B. (2016). The Determinants of Financial Inclusion in Africa: A Dynamic Panel Data Approach. University of Mauritius Research Journal, 22, 310-336.
18
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19
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20
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28
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32
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33
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34
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35
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40
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42
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43
ORIGINAL_ARTICLE
National Security and Economic Growth
D
uring the past few decades, national security plays a central role in the process of economic development. Also, foreign investment and trade have rapidly increased worldwide and have enhanced economic growth in developing countries. Although foreign investment and trade bring huge economic benefits, many developing countries fear that by opening up markets to competition and foreign investment without restriction, they will lose national security. Therefore, the balance between economic gains from foreign investment and trade presents a challenging task for national security. Is national security a necessary mechanism for Persian Gulf countries to promote their economic growth? This article will examine how national security and its relation with foreign investment and trade effect Persian Gulf region’s economic growth over the 1990-2014 periods. The results show national security has negative effect but its relation with foreign investment and trade has positive effect on the region’s economic growth.
https://ier.ut.ac.ir/article_64087_fb9d38538da3c278cddbb9a9a0a5a38e.pdf
2017-12-01
905
924
10.22059/ier.2017.64087
Keywords: National Security
economic growth
Foreign direct investment
Trade. JEL Classification: F43
F18
F21
F52
F64
Maryam
Asghari
asghari@ashrafi.ac.ir
1
Faculty of Administrative Science and Economics, Shahid Ashrafi Esfahani University, Esfahan, Iran
LEAD_AUTHOR
Mamounas, J. (2007). Controlling Foreign Ownership of U.S. Strategic Assets: The Challenge of Maintaining National Security in a Globalized and Oil Dependent World. Law and Business Review of the Americas, 13, 381-382.
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5
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6
Kollias, C., Manolas, G., & Paleologou, S. Z. (2004b). Defense Expenditure and Economic Growth in the European Union: A Causality Analysis. Journal of Policy Modeling, 26, 553-569.
7
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8
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9
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10
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11
https://www.econstor.eu/bitstream/10419/50874/1/51505058X.pdf.
12
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13
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14
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17
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18
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19
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20
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21
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26
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27
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29
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30
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32
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34
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35
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36
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37
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40
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41
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42
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43
ORIGINAL_ARTICLE
The Effects of Economic, Financial and Political Developments on Iran’s CO2 Emissions
This study examines dynamic interrelationships and causality relationships among CO2 emissions, economic, political and financial variables over the period of 1971-2011 for the case of Iran as one of the top CO2 emitting countries in the world. The results of ARDL and Johansen cointegration approaches confirm the existence of long run relationship among CO2 emissions, energy consumption, GDP, financial development, trade openness and political development. The results of variance decomposition analysis show that energy consumption, GDP and democracy can explain the big parts of the CO2 variations in the first year after initial shock but after ten years the roles of financial development, trade openness and energy consumption are more important. The estimation of long run and short run equations using ARDL approach indicates that the effects of GDP and energy on CO2 emissions are positive in both long run and short run. The effects of democracy although are minor but they are negative in short run and positive in long run. Our results confirm the existence of an inverted U-shaped relationship between trade openness and CO2 emissions and also a U-shaped relationship between CO2 emissions and financial development both in long run and short run.
https://ier.ut.ac.ir/article_64102_2c0890b1d20b5070a37031cfd208e0e1.pdf
2017-12-01
925
940
10.22059/ier.2017.64102
Keywords: Iran
CO2 emissions
development
Energy consumption
Political Changes. JEL Classification: Q5
G2
C2
C3
O1
Sajjad
Faraji Dizaji
s_dizaji@modares.ac.ir
1
Tarbiat Modares
LEAD_AUTHOR
Neda Al-Sadat
Ousia
nedaousia@yahoo.com
2
Tarbiat Modares University
AUTHOR
Bacon, R. W., & Bhattacharya, S. (2007). Growth and CO2 Emissions: How Do Different Countries Fare? World Bank, Climate Change Series Paper, 113, Retrieved from
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4
Chang, C. C. (2010). A Multivariate Causality Test of Carbon Dioxide Emissions, Energy Consumption and Economic Growth in China. Applied Energy, 87(11), 3533-3537.
5
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6
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7
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8
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11
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12
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13
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14
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15
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17
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Stewart, C., & Hessami, M. (2005). A Study of Methods of Carbon Dioxide Capture and Sequestration–the Sustainability of a Photosynthetic Bioreactor Approach. Energy Conversion and Management, 46, 403-420.
28
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29
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30
ORIGINAL_ARTICLE
The Rise and Fall of Top Incomes in Iran 1985-2015
T
his paper studies top income shares in Iran, using 26 Household Expenditure and Income Surveys conducted by the Statistical Center of Iran over the period 1985-2015. It is shown that after the imposed Iran-Iraq war, top income groups were raising their real income and income share by 2006; however, both their share and real income fell immediately after 2006 such that the numbers are now below their wartime level. It is explained that the fall is caused by the negative effects of the United Nations Security Council sanctions on the top capital income earners. The paper also measures the concentration of income by the inverted Pareto coefficient and finds that the concentration had been generally increasing by 2000; however, the upward trend reverses from 2000 onwards. Although the concentration of income and the top income groups’ share have fallen significantly in Iran in recent years, the numbers are still large, and Iran is among the most inegalitarian countries.
https://ier.ut.ac.ir/article_64104_b26f36955aefc14e589bdebb1a198ff0.pdf
2017-12-01
941
968
10.22059/ier.2017.64104
Keywords: Top Income Shares
Income Inequality
Concentration of Income
sanctions
Iran. JEL Classification: D31
D63
O53
Alireza
Oryoie
oryoie@ut.ac.ir
1
Faculty of Economics, University of Tehran, Tehran, Iran
LEAD_AUTHOR
Hossien
Abbasinejad
habasi@ut.ac.ir
2
Faculty of Economics, University of Tehran, Tehran, Iran
AUTHOR
Abbasi-Nejad, H. (2017). Iran’s Economy in the Beginning of Twenty First Century. Retrivied May 14, 2017, from
1
http://www.handresearch.org/pages/edo_list.php?id=77.
2
Alvaredo, F. (2011). A Note on the Relationship between Top Income Shares and the Gini Coefficient. Economics Letters, 110(3), 274-277.
3
Alvaredo, F., & Piketty, T. (2015). Measuring Top Incomes and Inequality in the Middle East: Data Limitations and Illustration with the Case of Egypt. CEPR Discussion Paper, DP10068, Retrieved from https://ssrn.com/abstract=25015422.
4
Angeles, L. (2010). An Alternative Test of Kuznets’ Hypothesis. The Journal of Economic Inequality, 8(4), 463-473.
5
Atkinson, A. B. (2007). Measuring Top Incomes: Methodological Issues. In A. B. Atkinson & T. Piketty (Ed.), Top Incomes over the Twentieth Century: A Contrast between Continental European and English-Speaking Countries (18-42). New York, NY: Oxford University Press.
6
Atkinson, A. B., & Piketty, T. (2007). Top Incomes over the Twentieth Century: A Contrast between Continental European and English-Speaking Countries. New York, NY: Oxford University Press.
7
Atkinson, A. B., Piketty, T., & Saez, E. (2011). Top Incomes in the Long Run of History. Journal of Economic Literature, 49(1), 3-71.
8
Bricker, J., Henriques, A., Krimmel, J., & Sabelhaus, J. (2016). Measuring Income and Wealth at the Top Using Administrative and Survey Data. Brookings Papers on Economic Activity, 2016(1), 261-331.
9
Burkhauser, R. V., Feng, S., Jenkins, S. P., & Larrimore, J. (2012). Recent Trends in Top Income Shares in the United States: Reconciling Estimates from March CPS and IRS Tax Return Data. Review of Economics and Statistics, 94(2), 371-388.
10
Cowell, F. A., & Kerm, P. (2015). Wealth Inequality: A Survey. Journal of Economic Surveys, 29(4), 671-710.
11
Cowell, F. (2009). Measuring Inequality. Retrieved from
12
https://pdfs.semanticscholar.org/5d6f/9fadcf20727c900b4b19ee5fc3aba681fb1d.pdf
13
Dell, F. (2005). Top Incomes in Germany and Switzerland over the Twentieth Century. Journal of the European Economic Association, 3(2/3), 412-421.
14
Easterly, W. (2001). The Middle Class Consensus and Economic Development. Journal of Economic Growth, 6(4), 317-335.
15
Farzanegan, M. R., Mohammadikhabbazan, M., & Sadeghi, H. (2015). Effect of Oil Sanctions on the Macroeconomic and Household Welfare in Iran: New Evidence from a CGE Model. Discussion Paper, 07-2015, Retrieved from
16
https://www.econstor.eu/handle/10419/109685.
17
Gorji, A. (2014). Sanctions against Iran: The Impact on Health Services. Iranian Journal of Public Health, 43(3), 381-382.
18
Kanbur, R. (2000). Income Distribution and Development. In A. B. Atkinson, & F. Bourguignon (Ed.), Handbook of Income Distribution (791-841). Amsterdam, Netherlands: Elsevier.
19
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20
Kuznets, S. (1955). Economic Growth and Income Inequality. The American Economic Review, 45(1), 1-28.
21
Leigh, A., & Van der Eng, P. (2009). Inequality in Indonesia: What Can We Learn From Top Incomes? Journal of Public Economics, 93(1), 209-212.
22
Piketty, T. (2003). Income Inequality in France, 1901–1998. Journal of Political Economy, 111(5), 1004-1042.
23
Piketty, T. (2006). The Kuznets Curve: Yesterday and Tomorrow. In A. V. Banerjee, R. Benabou, & D. Mookherjee (Ed.), Understanding Poverty (73-83). New York, NY: Oxford University Press.
24
Piketty, T. (2007). Top Incomes over the Twentieth Century: A Summary of Main Findings. In A. B. Atkinson & T. Piketty (Ed.), Top Incomes over the Twentieth Century: A Contrast between Continental European and English-Speaking Countries (1-17). New York, NY: Oxford University Press.
25
Piketty, T. (2014). Capital in the 21st Century. Cambridge, MA: Harvard University Press.
26
Piketty, T., & Qian, N. (2009). Income Inequality and Progressive Income Taxation in China and India, 1986–2015. American Economic Journal: Applied Economics, 1(2), 53-63.
27
Piketty, T., & Saez, E. (2013). Top Incomes and the Great Recession: Recent Evolutions and Policy Implications. IMF Economic Review, 61(3), 456-478.
28
Roine, J., & Waldenström, D. (2008). The Evolution of Top Incomes in an Egalitarian Society: Sweden, 1903–2004. Journal of Public Economics, 92(1), 366-387.
29
Saez, E., & Zucman, G. (2016). Wealth Inequality in the United States since 1913: Evidence from Capitalized Income Tax Data. The Quarterly Journal of Economics, 131(2), 519-578.
30
Salehi-Isfahani, D., Wilson Stucki, B., & Deutschmann, J. (2015). The Reform of Energy Subsidies in Iran: The Role of Cash Transfers. Emerging Markets Finance and Trade, 51(6), 1144-1162.
31
Thornton, J. (2001). The Kuznets Inverted-U Hypothesis: Panel Data Evidence from 96 Countries. Applied Economics Letters, 8(1), 15-16.
32
Yu, D. (2008). The Comparability of Income and Expenditure Surveys 1995, 2000, and 2005/2006. Steenbosch Economic Working Papers, 11/08, Retrieved from
33
https://www.ekon.sun.ac.za/wpapers/2008/wp112008/wp-11-2008.pdf.
34
ORIGINAL_ARTICLE
Stock Market Bubbles and Business Cycles: A DSGE Model for the Iranian Economy
T
his paper investigates the movement between stock market bubbles and fluctuations in aggregate variables within a DSGE model for the Iranian economy. We apply a new Keynesian monetary framework with nominal rigidity in wages and prices based on the study by Ikeda (2013), which is developed with appropriate framework for the Iranian economy. We consider central bank behavior different from Taylor Rule, and we suppose an economy with oil export. In order to study the role of money in economy, we apply “Money in Utility” approach. We study the TFP shock, the monetary policy shock, the government spending shock, the oil income shock and the sentiment shock. Bubbles in our model emerge through a positive feedback loop mechanism supported by self-fulfilling beliefs. Moreover, a sentiment shock drives the movements of bubbles that explain most of the stock market fluctuations and variations in real economy. The result of calibrated model reveals a relation between moments of variables in the model and moments of real data in the economy. Therefore, this model can help us to analyze the effect of stock market bubbles on macroeconomic variables in the economy.
https://ier.ut.ac.ir/article_64105_4cc6cb5f461141d85bcc059bfbf1b8dc.pdf
2017-12-01
969
1002
10.22059/ier.2017.64105
Keywords: DSGE Model
New Keynesian
Nominal Rigidity
Share Exchange Market Bubbles. JEL Classification: E12
E42
E44
Sahar
Bashiri
sahar.bashiri01@itsr.ir
1
Economics & Competitiveness Studies Research Department, Institute for Trade Studies and Research (ITSR), Tehran, Iran
LEAD_AUTHOR
Mosayeb
Pahlavani
pahlavani@eco.usb.ac.ir
2
University of Sistan and Baluchestan
AUTHOR
Reza
Boostani
r.boostani@cbi.ir
3
Economic Research and Policy Department, Central Bank of Iran, Tehran, Iran
AUTHOR
Afshari, Z., Mahmoodi, N., & Boostani, R. (2014). Evaluating the Neoclassical Growth Model in Explaining Iranian Business Cycles. Faslnameh Motaleat Eghtesadi Karbordi Iran, 3(9), 189-204.
1
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2
https://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp1495.pdf.
3
Bashiri, S., Pahlavani, M., & Boostani, R. (2016a). Optimal Monetary Policy and Stock Market Fluctuations. Applied Economics and Finance, 3(2), 157-178.
4
---------- (2016b). Stock Market Fluctuations and Monetary Policy in Iran. Faslnameye Tahghighate Modelsazi Eghtesadi, 6(23), 103-157.
5
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6
Bernanke, B. S., & Gertler, M. (1999). Monetary Policy and Asset Price Volatility. Paper presented at Fedral Reserve Bank of Kansas City Annual Conference, Jackson Hole (17-51), Retrieved from
7
https://www.kansascityfed.org/publicat/econrev/PDF/4q99bern.pdf.
8
Boostani, R. (2013). The Role of Transitory and Permanent Shocks in Business Cycle. Faslnameh Rahbordi Eghtesad, 6, 41-58.
9
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10
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11
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12
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http://www.icmb.ch/ICMB/Publications_files/Geneva%202.pdf.
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15
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16
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17
---------- (2008). Monetary Policy and Stock Market Boom-Bust Cycles. European Central Bank, Working Paper Series, 955, Retrieved from
18
https://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp955.pdf.
19
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20
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21
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22
Farmer, R. E. (2012a). Confidence, Crashes and Animal Spirits. Economic Journal, 122, 155-172.
23
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24
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25
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31
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32
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40
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41
---------- (2012). Bubbles and Total Factor Productivity. American Economic Review, 102, 82–87.
42
---------- (2011a). Bubbles and Credit Constraints. Boston University and Hong Kong University of Science and Technology, Manuscript, Retrieved from
43
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44
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45
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47
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48
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49
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50