University of TehranIranian Economic Review1026-654230220260601Eating Choices and Planet's Sustainability; How Far Consumers Are Willing to Pay for Sustainable Food Consumption in Middle-Income Countries?4264489686210.22059/ier.2024.370832.1007912ENFazlulHoqueDepartment of Agribusiness & Marketing, Sher-e-Bangla Agricultural University, Dhaka, Bangladesh.0000-0003-1729-2604AsmaAkterDepartment of Agricultural Finance and Management, Sher-e-Bangla Agricultural University, Dhaka, Bangladesh.0000-0003-1729-2604Journal Article20240110We often hear that the food that we enjoy must not cost the Earth; unfortunately, it frequently does. The food that we eat and the methods that are used to generate it have repercussions for the entire globe. Our food system needs to be improved if we want to live in a world where both people and wildlife can flourish. We are unable to make this adjustment to the system on our own, but choosing a diet that is both healthy and sustainable may be able to assist us in achieving a large decrease in the amount of greenhouse gas emissions that are produced by our food supply chain (WWF-2022). But there is always the question of how far average people from middle-income countries are willing to pay for a sustainable diet. Middle-income countries like Bangladesh manage to reach UN-SDG for zero hunger, but ordinary citizens might not enjoy sustainable meals regularly. Primary data from 200 respondents were collected through ‘face-to-face’ and ‘drop-off and collect’ survey methods by using an open-ended questionnaire set. Applying the binary logit regression, we have discovered the determinants that influence customers’ willingness to pay for sustainable meals. The findings of this study can be applied in our other middle-income countries.https://ier.ut.ac.ir/article_96862_8321a11fbedeb049d85f21ca8974b9e8.pdfUniversity of TehranIranian Economic Review1026-654230220260601The Interrelationships between Bank Leverage, Bank Stability, Credit Risk, and Liquidity Risk: Evidence from Asian-5 Countries4494799707110.22059/ier.2024.373454.1007957ENHandyOctavianusVocational Faculty, Universitas Sumatera Utara, Indonesia.IsfentiSadaliaVocational Faculty, Universitas Sumatera Utara, Indonesia0000-0002-4674-1221Beby KendidaHasibuanVocational Faculty, Universitas Sumatera Utara, IndonesiaTona AuroraLubisDepartment of Economics, Universitas Jambi, Jambi, Indonesia0000-0002-5728-0387Yasmin ChairunisaMuchtarVocational Faculty, Universitas Sumatera Utara, IndonesiaJournal Article20240303This study investigates the interrelationships among bank leverage, bank stability, credit risk, and liquidity risk in 93 ASEAN-5 banks between 2010 and 2019, with 930 firm-year observations. The generalized method of moments (GMM) estimator is employed to examine the linkages between bank leverage, bank stability, credit risk, and liquidity risk. The test results show a negative reciprocal relationship between bank leverage and stability. Also, the findings show a negative reciprocal relationship between credit risk and bank leverage. Furthermore, an increase in asset liquidity concentration tends to increase the use of leverage and vice versa. The findings of this study confirm that bank capital decisions have implications for critical concepts in banking, i.e., bank stability, credit risk, and liquidity risk. Additionally, this study proposes a new measurement for determining liquidity concentration. The research will be valuable to banking management and regulators in identifying the interrelationships between essential banking concepts to create soundness in the banking environment.https://ier.ut.ac.ir/article_97071_5ee119b25901a726d0dc2d2e6d5d63d5.pdfUniversity of TehranIranian Economic Review1026-654230220260601Antecedents and Consequences of Social Media Adoption in Muslim Community Based Nonprofit Organization4805059707210.22059/ier.2024.372732.1007937ENKezia ArumSaryDepartment of Economics, Universitas Mulawarman, Kalimantan, Indonesia0000-0002-6309-4484SyarifahHudayahDepartment of Economics, Universitas Mulawarman, Kalimantan, Indonesia0000-0003-0691-8595Journal Article20240216<span lang="EN">This study aimed to determine the factors influencing Social Media Adoption in the Muslim Community Tourism Awareness Group (Pokdarwis) in East Kalimantan. This type of verification research uses the explanatory research method, which explains the relationship between research variables and hypothesis testing. The important results of this research are: first, Agent Personality Traits significantly positively influence the Adoption of Social Media Marketing on marketing activities in the Muslim Community Tourism Awareness Group (Pokdarwis). This shows that the higher the Agent Personality Traits, dominated by the indicator of discovering new things, the higher the Adoption of Social Media Marketing will be. Second, Adopter Characteristics significantly positively influence the Adoption of Social Media Marketing in marketing activities in the Muslim Community Tourism Awareness Group (Pokdarwis). This shows that the higher the Adopter Characteristic, dominated by organizational policy indicators, the higher the Adoption of Social Media Marketing. The adoption of Social Media Marketing significantly positively influences Relational Benefits in marketing activities in the Muslim Community Tourism Awareness Group (Pokdarwis). This shows that the higher the Adoption of Social Media Marketing, dominated by the effective indicator, the higher the Relational Benefits.</span>https://ier.ut.ac.ir/article_97072_9ecf56c18a83efd303ea2017336530cf.pdfUniversity of TehranIranian Economic Review1026-654230220260601Assessing the Government Spending Efficiency in Africa: A Regional Analysis of Spending Efficiency with Stochastic Frontier Approach5065399716210.22059/ier.2024.354702.1007629ENOlawale DanielAkinyeleDepartment of Economics, Obafemi Awolowo University, Ile-Ife, Nigeria.0000-0003-3951-3738Olawale PhilipOdewoleDepartment of Accounting and Finance, Elizade University, Ondo, Nigeria.IfeoluwaKosemaniDepartment of Economics, Elizade University, Ondo, Nigeria.Journal Article20230215The performance of any government is measured by improvement in its citizens’ well-being and the quality of life they live, which tends toward human development. The need to improve human development remains an age-long phenomenon, from millennium development to sustainable development over the last two decades. With the current global economic crisis triggered by the COVID-19 pandemic, supply chain crisis, and macroeconomic imbalance, a rise in government spending profile may not be feasible to inhibit fiscal deficit. More so, increased government spending over time among African countries has not translated to a rise in human development. Therefore, this study assessed government spending efficiency among African countries. The study adopts stochastic frontier analysis among 40 African countries between 2000 and 2020. There is relatively low efficiency in government spending among African countries. Meanwhile, the region of North Africa has the most efficient level of spending. However, to have all-round development in Africa, there is a need for African countries to be more focused. Spending efficiency has been remarkable in 2019/2020 across all regions of Africa. Countries like South Africa, Cameroon, Burkina-Faso, Mozambique, and Morocco were able to perform above the regional average of government spending efficiency. There are relative differences in spending patterns among African regions. The divergence in spending efficiency among African countries could be the reason for the different ranks of human development in Africa.https://ier.ut.ac.ir/article_97162_8b6d47ed609b1f6651a79cb6210b63f8.pdfUniversity of TehranIranian Economic Review1026-654230220260601Heterogeneous Effects of Climate Change on Output across the Manufacturing Subsectors in Nigeria5405749707410.22059/ier.2024.373094.1007948ENOluwasegun OlawaleBenjaminDepartment of Research and Data Analysis , Lightway Research and Technology Centre, Ilorin, Nigeria0000-0001-6236-0560Victoria OluwatoyinFoyeDepartment of Economics, Faculty of Economics and Management Sciences, University of Ibadan, Ibadan, Nigeria0000-0002-3103-177XJournal Article20240226Climate change remains a global issue despite the efforts of international organizations to combat dangerous global warming, especially in developing countries like Nigeria. Therefore, this study aims to analyze the heterogeneous effects of climate change on output across the manufacturing subsectors in Nigeria from 1990 to 2021. The fully modified ordinary least squares method is used to analyze the time series data, and canonical cointegrating regression, along with diagnostic tests (normality and Wald restriction tests), is conducted to check the robustness of the models. The empirical results reveal that climate change has a significant negative effect on manufacturing output at the aggregate level and across the manufacturing subsectors. The adverse effect is particularly strong for Textile, Apparel and Footwear, Plastic and Rubber Products, and Chemical and Pharmaceutical Products subsectors. Moreover, the study finds that manufacturing output at the aggregate level and across the manufacturing subsectors responds negatively to exchange rate and positively to labor and capital. Based on the results, the study recommends that the government should discourage fossil fuel consumption and promote renewable energy consumption such as solar, wind, hydro, and geothermal to slow climate change. Also, the government needs to implement structural reforms to reduce reliance on foreign inputs and final products, enhance domestic production and exportation, increase foreign reserves, and strengthen the Nigerian currency.https://ier.ut.ac.ir/article_97074_95eb83542315080493f9a00e01920fe6.pdfUniversity of TehranIranian Economic Review1026-654230220260601The Role of Market Sentiment and Economic Policy Uncertainty on the Excess Returns of Stock Portfolios: Evidence from Iran5755999707610.22059/ier.2024.372795.1007942ENMohammad EbrahimAghababaeiDepartment of Financial Management and Financial Engineering, Faculty of Finance Sciences, Kharazmi University, Tehran, Iran.0000-0003-3123-7994MahyaKarimzdeh KhosroshahiDepartment of Financial Management and Financial Engineering, Faculty of Finance Sciences, Kharazmi University, Tehran, Iran.0009-0008-6998-9298SaeidMadaniDepartment of Financial Management and Financial Engineering, Faculty of Finance Sciences, Kharazmi University, Tehran, Iran.0000-0003-1511-8215Journal Article20240229The market sentiment and economic policy uncertainty in the capital market can have a significant impact on stock returns. Investors expect to achieve excess returns over bank deposit interest rates (as the risk-free rate) by investing in the stock market and accepting risks. Therefore, this study examines the relationship between market sentiment, economic policy uncertainty, and excess returns of investment portfolios on the Tehran Stock Exchange. To calculate the economic policy uncertainty and market sentiment index (based on the proposed composite index by Baker and Wurgler, 2006), the study employs principal component analysis (PCA) using the five-factor Fama-French variables along with the momentum factor. The research findings indicate that overall, the market sentiment index does not have a significant impact on the excess returns of stock investment portfolios. However, economic policy uncertainty has a positive and significant effect on excess returns. Furthermore, the study findings demonstrate that the impact of market sentiment and economic policy uncertainty on the excess returns of stock portfolios varies across different portfolios.https://ier.ut.ac.ir/article_97076_76375d48e6c37356f126cf1db6f1b95e.pdfUniversity of TehranIranian Economic Review1026-654230220260601The Impact of Investment Manager Expertise on Mutual Fund Performance in Indonesian Dynamic Market Conditions6006159716310.22059/ier.2024.373631.1007962ENAlfiSyahriFaculty of Economics and Business, Diponegoro University, Semarang, Indonesia.0009-0008-5065-4228Irene Rini DemiPangestutiFaculty of Economics and Business, Diponegoro University, Semarang, Indonesia.0000-0003-3008-0972Journal Article20240310This study investigates the performance of 29 equity mutual funds in Indonesia, focusing on the influence of investment-manager expertise and market conditions. Using primary data sourced from Infovesta, we uncover a significant relationship between market conditions and fund performance. Our analysis reveals a statistically significant probability of changes in market conditions, with a calculated probability of 0.000, indicating a rare occurrence, less than 5% of the time. The coefficient value of 1.563714 further strengthens this relationship, indicating a substantial impact of market conditions on fund performance and supporting the acceptance of our third hypothesis. We find that bullish and bearish market conditions, representing rising and declining stock markets respectively, have a profound effect on equity mutual fund performance. Specifically, during bullish phases, fund performance improves, while in bearish market conditions, it declines. These results highlight the complex interplay between market dynamics and fund performance, underscoring the importance of skilled management in navigating market fluctuations effectively. Our findings contribute to the refinement of investment strategies, offering insights for achieving enhanced performance in dynamic market environments and advancing the discourse on effective portfolio management strategies.https://ier.ut.ac.ir/article_97163_d2e30fa59051e577818fdfe04334f963.pdfUniversity of TehranIranian Economic Review1026-654230220260601Financial Complexity: Evidence from Iran6166359707710.22059/ier.2024.372759.1007940ENFatemahPoorabdollahDepartment of Economics, Yazd University, Yazd, Iran.0009-0003-5089-1761Seyed NezamaldinMakyianDepartment of Economics, Yazd University, Yazd, Iran.0000-0002-8890-3890Journal Article20240216In recent years, technological advances have increased complexity across many domains of human life, including the economy and its subsectors such as finance. These developments have posed challenges for many economies, including Iran. This study investigates financial complexity in the Iranian economy over the period 2005–2021. To this end, an adjacency matrix for Iran’s financial sector is constructed using World Bank data in order to depict the interconnectedness and complexity of the country’s financial system. The resulting financial graph indicates that the capital market exerts a weaker influence than the money and insurance markets, whereas among financial institutions, banks and other depository institutions play a central role in the country’s financial system. The government and state-owned banks, channeling funds obtained from the banking sector, also play a significant role in Iran’s financial system. Using McCabe's method, the complexity number for the financial graph of Iran was calculated to be 79, which indicates a very high level of complexity and also high systemic risk in the financial system of Iran.https://ier.ut.ac.ir/article_97077_5e1dd0062ac1ce152b5ad09f49ee97f4.pdfUniversity of TehranIranian Economic Review1026-654230220260601Optimum Public Debt in Iran: An Emphasis on The Precautionary Savings Model6366639716410.22059/ier.2024.362274.1007855ENEnsiehMosaddeghiDepartment of Economics, University of Isfahan, Isfahan, Iran.0000-0001-7126-2305RasoulBakhshi DastjerdiDepartment of Economics, University of Isfahan, Isfahan, Iran0009-0008-1685-9545Seyyed AqilHoseinyDepartment of Economics, Yasouj University, Yasouj, Iran0000-0001-8666-3208Journal Article20231201This study examines the effects of the government debt-to-GDP ratio on welfare in the Iranian economy. Because of limited access to loans in Iran, the analysis employs an incomplete-markets model based on Aiyagari’s heterogeneous-agent framework. In addition to idiosyncratic wage risk, households face both budget and borrowing constraints. Given that the Iran’s economy faces both high inflation and borrowing constraints, Iranian households prefer to hold assets such as gold, land, and term deposits, besides government debt and physical capital, for precautionary savings purposes. Therefore, this study incorporates the above-mentioned assets in the model. The model is solved numerically using the finite element method (FEM). The results show that the optimal quantity of debt is significantly negative according to the welfare criteria, and the welfare gain from moving to the optimum is 2.66% of per capita consumption, which is not negligible. As a result, the negative role that debt plays in the model (crowding out private capital) is more than the positive role of enhancing liquidity, and private sector spending should replace government spending. It is optimal for the government to accumulate assets in the long run so that all government expenditures are financed by the interest income earned on private assets. Furthermore, if excessive holding of assets is restricted through policies such as imposing taxes on holding assets and developing financial markets, the welfare loss of maintaining the current level of debt instead of the optimal quantity will decrease.https://ier.ut.ac.ir/article_97164_f889fb1a3185ffbb3f75889c8c37150b.pdfUniversity of TehranIranian Economic Review1026-654230220260601Modeling the Commercial Flow of Primary Agricultural Products between Iran and the Eurasian Economic Union Member Countries Using a Network Approach6646939716710.22059/ier.2024.375462.1007998ENAliFakourDepartment of Economics, University of Isfahan, Isfahan, Iran.0009-0002-6061-9422KariemAzarbayejaniDepartment of Economics, University of Isfahan, Isfahan, Iran.0000-0002-6561-0809MohammadVaez BarzaniDepartment of Economics, University of Isfahan, Isfahan, Iran.0000-0001-6351-2060Journal Article20240422Trade and supply of primary agricultural products are crucial and strategic. Therefore, analyzing the trade network and understanding the country’s position in the trade flow of primary agricultural products is paramount. This study used a network model to examine Iran’s position in the trade flow of primary agricultural products with EAEU member countries between 2000 and 2021. The network’s characteristics and Iran’s network indices were calculated. According to the results, all the networks formed in these years had high power distribution and clustering coefficients. Also, the betweenness centrality index results show that Iran was not an influential country in the EAEU primary agricultural products trade network during the study years. Iran must benefit more from this union’s primary agricultural product trade capacities and take operational measures to increase its role in the trade network of basic agricultural products with the Eurasian Economic Union.https://ier.ut.ac.ir/article_97167_5ba9603ba73ce1b227ad21159027fa6d.pdfUniversity of TehranIranian Economic Review1026-654230220260601Comparing the Efficiency of Rural Ecolodges Using by Data Envelopment Analysis Method (Case Study: Iranian Provinces)6947149748510.22059/ier.2024.361602.1007752ENMaryamRasoulzadehTourism Research Institute, Iranian Academic Center for Education, Culture, and Research (ACECR); Department of Economics, Ferdowsi University of Mashhad, Mashhad, Iran.AliFiroozzareDepartment of Agricultural Economics, Faculty of Agriculture, Ferdowsi University of Mashhad, Mashhad, Iran.Journal Article20230713Ecolodges, which allow visitors to stay in the community, are one of the services offered in rural tourism. This study aims to evaluate the efficiency of these units in the Iranian regions. The Ministry of Handicrafts, Cultural Heritage, and Tourism provided the necessary information, and the statistical population comprises ecolodge units in 31 provinces. The study is done using Data Envelopment Analysis (DEA), with the model’s inputs being the number of ecolodge units and the number of beds, and the outputs being the number of visitors and income, respectively, for each province. According to the features of the research, envelope form (BCC), slack-based measurement (SBM), super efficiency (SE), and most productive scale size (MPSS) models have been utilized among the many efficiency estimate models. The findings indicate that six provinces—Tehran, Mazandaran, Golestan, Isfahan, Qom, and Kurdistan—are efficient in ecolodge units and they have grade 1 in the efficiency calculations, whereas the other provinces in the country are inefficient when the overlap of the results of all four models is taken into account, and their efficiency scores are as follows: the provinces of “East Azerbaijan (0.75), West Azerbaijan (0.68), Ardabil (0.79), Alborz (0.65), Ilam (0.77), Bushehr (0.68), Chaharmahal and Bakhtiari (0.62), South Khorasan (0.67), Razavi Khorasan (0.9), North Khorasan (0.73), Khuzestan (0.95), Zanjan (0.87), Semnan (0.58), Sistan and Baluchestan (0.67), Fars (0.83), Qazvin (0.89), Kerman (0.84), Kermanshah (0.7), Kohgiluyeh (0.68), Gilan (0.88), Lorestan (0.9), Markazi (0.56), Hormozgan (0.8), Hamedan (0.7), and Yazd (0.64)”. Suggestions have also been made to attract tourists and boost the efficiency of ecolodge facilities.https://ier.ut.ac.ir/article_97485_89e025a41bec94fd1216ed72743379ef.pdfUniversity of TehranIranian Economic Review1026-654230220260601Shall the Indonesia-OIC Countries’ Free Trade Agreements on Modest Fashion Be Implemented?7157439748710.22059/ier.2024.373324.1007956ENMasruriMuchtarDepartment of State Financial Management, Polytechnic of State Finance STAN, South Tangerang, Indonesia.0000-0002-6107-1115Ario SenoNugrohoDepartment of State Financial Management, Polytechnic of State Finance STAN, South Tangerang, Indonesia.0000-0002-6838-3381SriMurwaniDepartment of State Financial Management, Polytechnic of State Finance STAN, South Tangerang, Indonesia.0009-0003-4680-6130Journal Article20240303A free trade agreement (FTA) could be a first step towards greater economic integration among OIC countries. This paper explores the impact of the proposed Indonesia-OIC Countries FTA on the modest fashion industry under a general equilibrium framework, focusing on indicators such as welfare, GDP, trade balance, investment, and job opportunity. It utilizes computable general equilibrium (CGE) analysis using the Global Trade Analysis Project (GTAP) model. For analysis purposes, 65 GTAP sectors, representing the whole regional economy, have been aggregated into four sectors, and 141 GTAP regions, representing the whole world, have been aggregated into 13 regions. The scenario is Indonesia conducting an FTA with ten potential OIC export destination countries by reducing import tariffs for modest fashion products to 0%. It is predicted that Indonesia will receive the highest welfare increase of USD 140.83 million, followed by Morocco. The highest positive impact on real GDP will be experienced by Indonesia, with a positive change of 0.004%, followed by Morocco and Turkey. Egypt is projected to experience the largest decline in real GDP. Indonesia is projected to experience the most significant trade balance deficit, amounting to USD 198.13 million. Almost all OIC countries will experience an increase in investment, especially Indonesia, which is predicted to increase by 0.069%. Both skilled and unskilled workers will experience increased employment opportunities across all modest fashion industries. This paper contributes to the literature by focusing on critical aspects of the FTA's impact on modest fashion through the elimination of import tariffs among OIC countries.https://ier.ut.ac.ir/article_97487_f052d1708d0c10d62d856020ae4e5466.pdfUniversity of TehranIranian Economic Review1026-654230220260601The Simulation of a Competitive Market for Gasoline in Iran: Using a Game Theory Approach7447609657110.22059/ier.2024.370903.1007917ENKosarGholipourFaculty of Agriculture, University of Tabriz, Tabriz, Iran.0009-0008-1325-4794JavadHosseinzadFaculty of Agriculture, University of Tabriz, Tabriz, Iran.0000-0002-7023-2355Journal Article20240123The economic growth and development of countries rely on energy; however, the limited and non-renewable nature of underground resources and petroleum products such as gasoline, along with the environmental pollution caused by their high consumption, calls for efficient utilization. Gasoline, of which Iran is the world's twelfth-largest consumer with a daily usage of 352,000 barrels, plays an important role in Iran’s economy. However, the regulated price of gasoline, which does not reflect its true value and is not determined by a competitive market, hinders market efficiency. To address this, the present study estimated the relevant parameters by identifying the factors influencing supply and demand, using simultaneous equations for the period 2004–2018. Based on the results, the real price coefficient of gasoline is not statistically significant for demand, but the price coefficient of liquefied petroleum gas is significant, with the highest value at 0.2 in Kurdistan. The per capita income coefficient averages 0.7, being highest in Sistan and Baluchestan at 1 and lowest in Yazd at 0.3. For supply, the real price coefficient of gasoline indicates a decrease in supply despite a price increase, while technology has a positive effect. Through a cooperative game that models the players’ objective functions, a Nash equilibrium was obtained for a simulated competitive market. Based on the competitive market prices, gasoline consumption was then determined. Given the potential for global supply and the significant difference between competitive and monopoly prices, liberalizing the gasoline market and supplying it globally are recommended, allowing market demand and supply to dictate its price. This approach would help control consumption, minimize welfare losses, and alleviate the government's budget pressures arising from subsidizing gasoline and distributing it unfairly among income deciles.https://ier.ut.ac.ir/article_96571_19feac611deed554d2bf05a3d819b7f9.pdfUniversity of TehranIranian Economic Review1026-654230220260601The Roles of Climate Change and Food Security on Fertility Rate: Evidence from MENA Countries7617929748810.22059/ier.2024.371912.1007928ENNooshinKarimi AlavijehDepartment of Economics, Faculty of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad, Iran.0000-0002-1372-9402NargesSalehniaDepartment of Economics, Faculty of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad, Iran.0000-0002-7505-5335SamaneZangoeiDepartment of Economics, Faculty of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad, Iran.0009-0006-0224-9450Journal Article20240211Climate change and reduced food security can have devastating effects on society and especially human health. Therefore, this paper aims to investigate the impact of climate change and food security on the fertility rate in the Middle East and North Africa (MENA) by applying the novel Method of Moments Quantile Regression (MMQR) technique over the period from 2000 to 2020. Historical temperature and precipitation are included in the study model as climatic factors, and the food production index is considered a proxy for food security. In addition, the impact of the female labor force participation rate and the female population on the fertility rate have been investigated. The results from the estimations suggest that food security, mean precipitation, and female population increase the fertility rate. The impact of mean precipitation increases with higher quantiles. In addition, mean temperature and female labor force participation rate significantly decrease the fertility rate in all quantiles. In addition to protecting women's rights to education and employment, policymakers in the region must adopt appropriate policies and laws to provide the conditions for them to have children. Also, since climate change is a severe threat to the region's countries, governments should adopt appropriate policies in the agricultural sector, such as preventing the production and export of water-intensive crops, to prevent food insecurity.https://ier.ut.ac.ir/article_97488_2979df3d399fc8f672d1d5010e930cb2.pdfUniversity of TehranIranian Economic Review1026-654230220260601Good Governance in Large Energy-Consuming Economies: The Role of Energy Security and Environmental Sustainability Policies79383810786710.22059/ier.2026.412217.1008418ENMasoudShiraziFaculty of Economics, University of Tehran, Tehran, Iran.0000-0002-9226-4729Journal Article20260311The cultural, political, social, and economic dimensions of global stability are sensitive to the contribution of portfolio decisions of primary energy sources, especially for the world’s large energy-consuming economies (L.E.C.E). This research aims to assess the impact of energy security policies (E.S.P)—the diversification of primary energy supply (D.P.E.S) and primary energy demand (D.P.E.D), and the environmental sustainability policy (E.V.P)—the clean energy portfolio (N.C.F.P), with the control variables including human development index (H.D.I), per capita gross domestic product (G.D.P), and economic complexity (E.C) on the performance of governance indices in a panel of twenty-five L.E.C.Es from 1998 to 2020. The findings support the causal and long-run relationships across the governance systems, applying the dynamic panel and panel cointegration models. The results also show that the impacts of E.S.P and E.V.P on the governance indices are heterogeneous. Specifically, the D.P.E.D positively affects the voice and accountability, political stability, and regulatory quality. Moreover, the development of D.P.E.S enhances the voice and accountability, government effectiveness, and control of corruption. Further, the government effectiveness and control of corruption are also positively affected in response to the N.C.F.P. Collectively, the government effectiveness, regulatory quality, rule of law, and control of corruption are more challenging aspects of good governance to achieve in response to energy system development. Accordingly, the objective priorities of good governance are necessary to improve the stability of the countries, especially when the E.S.P and E.V.P are formulated and implemented.https://ier.ut.ac.ir/article_107867_de85f9ed1016caf3a0e1da032d78da5c.pdf