Hodjatollah Mirzaei; Narges Razban; Teymor Mohamadi; Habib Morovat
Abstract
Housing price shocks of one region may spread to the housing market of neighboring regions or geographical areas bounded by political border and lead to the formation of price shocks in shock-receiving areas. The housing policies may not be effective when implemented regionally and separately ...
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Housing price shocks of one region may spread to the housing market of neighboring regions or geographical areas bounded by political border and lead to the formation of price shocks in shock-receiving areas. The housing policies may not be effective when implemented regionally and separately if there is a confirmed network connection between the housing markets of regions. Price shocks to a housing market spreads with a delayto interconnected housing markets, ultimately resulting in the diffusion of the price shock across the entire of the housing network. This researchaims to investigate the housing network between selected cities (centers of the country's provinces) using the VAR model and Forecast Error Variance Decomposition (FEVD). The results of this research confirm the existence of a network connection between the housing markets of the country's provinces, and unlike previous studies, the results show that it is not only the city of Tehran that spreads price shocks to other regions, but also cities such as Karaj, Shiraz, and Arak spread price shocks to other cities. In addition, the results suggest that the recent price jump, since 2019 has significantly increased the density of the housing network in the country. Based on this, price shocks are expected to be distributed more quickly throughout the country.
Introduction
In addition to the fact that economic characteristics, macroeconomic policies, and external factors affect housing prices, housing price shocks in neighboring geographical areas also spread to housing prices in each region and can lead to the formation of price changes in the price-accepting region. Therefore, it is essential to investigate the network connection between the housing markets of the geographical regions within a country. This research aims to explore the network connections and dynamics between housing markets in provincial centers, as well as the relationships between all pairs of centers to form a comprehensive housing market network for the country. Specifically, the study seeks to identify: (a) the centers of the provinces whose housing price disturbances are most contagious to other provinces and (b) the centers of the provinces that are most affected by the housing price disturbances of other provinces should be identified.
Methods and Material
The study utilized data from the Statistics Center spanning period from 2009 to 2011.
The research methodology employed the vector autoregression (VAR) model. To address the identification problem in the model, the centers of the provinces were classified into four groups:
1: Tehran, Alborz, Mazandaran, Isfahan, Gilan, Khorasan-Razavi, Qom, Qazvin and East Azerbaijan.
2: Fars, Khuzestan, Golestan, Hormozgan, Bushehr, Zanjan and Hamedan.
3: Semnan, Yazd, Lorestan, North Khorasan, Kerman, South Khorasan, Kohgiluyeh and Boir Ahmad, Markazi and Kurdistan.
4: West Azerbaijan, Ardabil, Ilam, Kermanshah, Sistan and Baluchistan, and Chaharmahal and Bakhtiari.
In the network connection approach proposed Diebold and Yilmaz (2014), the vector autoregression model or VAR has been used.
In a country with three geographical regions A, B and C:
(1)
The VAR system of equations has three equations for housing prices in areas A, B, and C. The housing price in each region such as A at the current time (t) is a function of the price of the same region in previous periods ( ), and the price of other regions in previous periods ( and ) (k=1, 2, .. K). The effectiveness of the price of region A from the price of the same region and regions B and C in the previous periods are measured by β-11k, β-21k, and β-31k coefficients, respectively. The number of optimal breaks in equation (1) is determined by the Schwartz criterion.
In order to form a network connection and to check the amount of shock propagation from region i to j, variance analysis of prediction error is used. In this regard, Diebold and Yilmaz (2014) introduced four indicators:
(1)Shock received from others: The shock received by each region from other regions
FC=
(2)Shock sent to others: The shock sent by each region to other regions
OC=
(3)Total connections per network: average total shock per region
TC=
(4)Net communication or NC: the net shock sent by any region to other regions
NC=
Correlation between regions based on variance analysis
Shock received from other areas
areas
Shock sent to other areas
Results and Discussion
The reliability test of Becker et al. (2007) was conducted for all provinces, which was found to be significant in all cases.
Based on the results of VAR model and variance analysis:
First group: Isfahan and Qom are the biggest receivers and Mashhad is the weakest recipient. Karaj and Tehran are the biggest senders of shocks and Qom and Isfahan are the weakest senders.
Second group: Gorgan and Hamadan are the most important and Bushehr is the weakest recipient. Shiraz and Zanjan are the most important shock transmitters , while Bandar Abbas and Bushehr are the weakest.
Third group: Semnan and Sanandaj are the most important shock receiver, and Bojnord is the weakest receiver; Arak and Yazd are the most important sender of shocks and Sanandaj is the weakest sender .
Fourth group: Ardabil and Kermanshah are the most important senders and receivers of price shocks, respectively. The calculation of the total communication index in the housing network shows that the first group has the densest and the fourth group has the thinnest housing network.
In order to investigate the evolution of the housing network (changes in density over time), the Galtan's regression logic was used indicating an increase in the density of the housing network in the centers of the provinces over time.
Conclusion
The dynamics of real housing price changes demonstrate three distinct patterns.. During the years 2009 to 2012, the price of most centers decreased and remained almost constant from 2012 to 2018, and then all the centers had a sharp price increase. As a result:
(1) Karaj, Tehran, Shiraz, Arak and Ardabil sent the most price shocks;
(2) Isfahan, Gorgan, Semnan and Kermanshah received the most price shocks,
(3) the strongest housing network was observed between the cities of Mashhad, Sari, Qom and Tabriz, Isfahan, Karaj, Tehran, Qazvin and Rasht and
(4) the housing network among the provincial centers has increased during the years (2009 to 2010).
In times when the living conditions in the cities that are significant senders the shock become difficult, other cities within the network have become centers of population attraction and can change their roles. Consequently, it is advisable for housing market policies to consider the mutual influence between city prices. By doing so, when market price jumps occur, the extent of shock transmission from these driving centers can be somewhat controlled, thereby mitigating market excitement and excessive growth in prices. As an example, the policies on the supply side can be such that the supply in the shock-sending areas is facilitated. Preventive measures such as supporting the supply of semi-finished units, facilitating the conditions for issuing permits, facilitating access to construction loans, activating pre-sale tools, etc., should be adopted in leading areas so that when price jumps occur, shocks will be sent from these regions to other regions at a slower rate. it is advisable for housing market policies to consider the mutual influence between city prices. By doing so, when market price jumps occur, the extent of shock transmission from these driving centers can be somewhat controlled, thereby mitigating market excitement and excessive growth in prices.
Acknowledgment
In the end, we would like to express our gratitude to Dr. Nasser Khiabani, Dr. Ali Nasiri-Aghdam, Dr. Mirhossein Mousavi, and Dr. Taleblo, for their invaluable contributions to this paper.
Alireza Ebrahimi Nourali; Karim Emami; Teymour Mohammadi
Abstract
The purpose of this paper is to design a unique pricing system (price-cap) for Iran's water and wastewater industry to ensure fair pricing for its customers, encourage effective investment planning, and improve corporate productivity and efficiency. To this end, the translog frontier cost function ...
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The purpose of this paper is to design a unique pricing system (price-cap) for Iran's water and wastewater industry to ensure fair pricing for its customers, encourage effective investment planning, and improve corporate productivity and efficiency. To this end, the translog frontier cost function form using the panel- data of thirty-five (35) water and wastewater companies over the period 2012-2017 is used to calculate the aforementioned components and X-factor and use it in the price-cap model for a five-year period, has been used. The price ceiling decreasing for the most efficient company was 2% and for the most inefficient company was 28%. In other words, in the first year of implementation of the price ceiling adjustment model, the most efficient water and wastewater company will be allowed to decrease its base or initial price by 2%, but the most inefficient company will be allowed to more decrease by 28%. It is this incentive that fulfills the purpose of implementing the price-cap model as an incentive regulation method.
abbas shakeri; teymour mohammadi; Mohammad Jafari
Abstract
The significance of oil market and its impact on economic growth in oil-exporting and oil-consuming countries has led to examination of factors affecting it in different studies. Financial market and its components have penetrated in traditional oil market and this has resulted in creation of exchanges ...
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The significance of oil market and its impact on economic growth in oil-exporting and oil-consuming countries has led to examination of factors affecting it in different studies. Financial market and its components have penetrated in traditional oil market and this has resulted in creation of exchanges to trade oil-related securities. Therefore, the importance of financial markets has emerged not as an exogenous variable but as an endogenous variable within the oil market. Scientific results of the research demonstrate that the long-term impact of futures markets on the oil market is definite, however during the crises, due to the concerns about complicated crisis conditions, the effective time horizon becomes short-term, and consequently it is the spot market that influences future variables. Therefore, it is suggested that, in order to prevent the impact of global financial crises on the state’s budget, we have to monitor the financial markets and also participate in oil futures market which has the advantage of generating risk coverage and ensuring the country’s budget to become secure against price fluctuations of international markets. Finally, by undertaking a wise strategy of speculation, we can take advantage of potential opportunities, if supported by domestic financial institutions and Ministry of Petroleum and, therefore, earn the country tremendous revenues.
fatemeh mirmohammadalitajrishi; teymour mohammadi; Ali Asghar Salem
Abstract
Expenditure pattern across households varies due to differences in their economic circumstances, household size and composition. So, movements in prices of goods over time will have different impacts on households. “Equivalence scale” is an index that enables us to do welfare comparisons ...
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Expenditure pattern across households varies due to differences in their economic circumstances, household size and composition. So, movements in prices of goods over time will have different impacts on households. “Equivalence scale” is an index that enables us to do welfare comparisons and measurements of poverty and inequality across heterogeneous households, under consideration of households’ demographic characteristics and economies of scale in consumption. Implementation of targeted subsidies policy in Iran that has made significant price variations in recent years, has changed Iranian households’ equivalence scale. In this research, the urban households’ equivalence scale and variation of relative cost of a child was estimated using PS-QUAIDS and nonlinear Seemingly Unrelated Regressions (SURs), applying Iranian household's budget dataset for 2008 to 2012. Results indicate that the cost of an urban child is equal to 13 percent of an adult for 2008 until 2010 and the targeted subsidies policy has a negative and significant impact on equivalence scale.
Mahnoush Abdolah Milani; teymour mohammadi; solaleh tavassoli
Abstract
In the past few decades, the rapid growth of health expenditure among countries and considerable differences between per capita health expenditures in different countries, have led to extensive studies about determinants of health expenditures. The aim of this study is to identify such factors across ...
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In the past few decades, the rapid growth of health expenditure among countries and considerable differences between per capita health expenditures in different countries, have led to extensive studies about determinants of health expenditures. The aim of this study is to identify such factors across different countries which can be put into distinct income groups. For this purpose, panel data regression technique for 148 countries from 1995 to 2013 with fixed effects model was used. The results show that, in contrast to previous studies which use macro data analysis, the effect of population ageing in upper-middle- and high-income countries, which face the greatest rate of population ageing, on health expenditures was shown to be positive at a significant level. Income as being not the sole factor associated with health expenditure, our results show that life expectation and the share of young population (under 14) are among important factors. Another driver of health expenditure was revealed to be the total government expenditure as a share of GDP that was insignificant only for low income countries. This observation might reflect the trade off in domestic health expenditures made by the low-income countries as a result of receiving international aids. The income elasticity for all groups was below unity and suggestive of health care to be a necessity good in all countries.
seyyed hasan ghavami; . .; teymour mohammadi; Mansour Ranjbar
Abstract
By considering the different importance of collateral variable in Islamic and in conventional banking, theoretical and experimental studies show that the necessary convergence in the credit relationship between bank and customer has not been achieved. In this article, in addition to the explaining feasibility ...
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By considering the different importance of collateral variable in Islamic and in conventional banking, theoretical and experimental studies show that the necessary convergence in the credit relationship between bank and customer has not been achieved. In this article, in addition to the explaining feasibility of studying and accepting empirical role of collateral in commercial profit - loss sharing contracts, we have studied the dual role of collateral as screening and motivation tool in banking relations. We have also used credit data of Bank Refah Kargaran with application of Logit estimation to test our hypotheses regarding the role of collateral. Based on our results, the hypothesis that borrowers with lower risk have provided safer collateral, has been confirmed. This result shows the existence of adverse selection phenomenon. So, low-risk individuals tend to send signals of their quality and reveal their situation to banks. In addition, other economic and social variables of contract could use the potential of signaling and contribute to reduce the role of collateral. In the data under consideration, except for the variable of account history-interest rate, this hypothesis was rejected and other economic and social variables have failed to have the expected impact.
Mostafa Mobini Dehkordi; Teymour Mohammadi
Volume 14, Issue 55 , January 2015, , Pages 41-70
Abstract
In recent years, researchers have been increasingly noticed economic growth and its determinants. Exchange rate and its volatility are important factors in determining a country's economic growth. Various studies in this regard have shown contradictory results concerning the effects of exchange ...
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In recent years, researchers have been increasingly noticed economic growth and its determinants. Exchange rate and its volatility are important factors in determining a country's economic growth. Various studies in this regard have shown contradictory results concerning the effects of exchange rate volitality on economic growth. The purpose of this study, Considering the importance of this issue, is to evaluate the nonlinear effects of real exchange rate uncertainty on economic growth (oil and non-oil) from 1369/1 to 90/4. In this study, economic growth is a function of real exchange rate uncertainty, investment rate, active population growth and growth rate of human capital. To estimate the amounts of real exchange rate uncertainty, GARCH In Mean model is used. With the implementation of a program in eviews, a certain level of exchange rate volatility was calculated using criteria of standard deviation minimum. Then, GMM model is used to determine the effects of this volatility on economic growth. The results show that the real exchange rate uncertainty up to a certain level, which is investigated in this research, has a negative effect on economic growth, whether oil or non-oil.
Kamran Mani; Jamshid Pajuyan; Teymor Mohammadi
Volume 11, Issue 42 , October 2011, , Pages 13-37
Abstract
The relationship between financial markets and the economic growth is a subject that has obviously been observed by many economists since the lifetime of Joseph Schumpeter. There have been various analyses and opinions on the development of financial markets and their effects on economic growth, and ...
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The relationship between financial markets and the economic growth is a subject that has obviously been observed by many economists since the lifetime of Joseph Schumpeter. There have been various analyses and opinions on the development of financial markets and their effects on economic growth, and various conclusions have been achieved through experimental studies. Some theoreticians view religious and cultural condition of countries as the factors of satisfactory effects on economical growth. Others believe bureaucracy and political establishment to be the main causes of such growth, while another group believes that the economic policy and strategies of each country play roles. The present article emphasizes the effect of taxes on the relationship between financial markets and economic growth in a model of endogenous growth. This effectiveness will be analyzed for period of (1992-2008). In this analysis, the study of panel data of more than 65 countries in the world signifies that taxes have negative effects and the development of commercial interactions has positive effects on the relationship between financial markets and economic growth. of Course, empirical findings of the study do not indicate significant relationship between taxes, financial markets and economic growth in the middle east countries.
