Reza Akbarian; Mohamad Karkon
Volume 13, Issue 48 , April 2013, , Pages 79-107
Abstract
Based on the debates on the impacts of globalization on government size, efficiency hypothesis and compensation hypothesis are two measure of globalization. The compensation hypothesis predicts that governments perform a risk-mitigating role against internationally generated risk and economic dislocations. ...
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Based on the debates on the impacts of globalization on government size, efficiency hypothesis and compensation hypothesis are two measure of globalization. The compensation hypothesis predicts that governments perform a risk-mitigating role against internationally generated risk and economic dislocations. Under efficiency hypothesis, governments compete to attract capital, and this competition will result in decreasing government presence in economy. In this paper we try to investigate the reason of government enlargement in Iran. We use trade openness (as globalization index), real income per capita, inflation, population, oil income and government size (based on government expenditure) and consumption expenditure in the form of percentage of GDP. An Autoregressive Distributed Lags (ARDL) model) is developed for this study based on Bounds Testing (Pesaran, et.al, 2001). The result of this model shows that in the long run trade openness has no effect on government size but there is a significant relation between them in short run. Furthermore, the relation between globalization and social welfare and security shows that these expenditures didn’t compensate the effect of shock resulted from trade openness. In this way, the oil income has created a great income reserves for government which make government enlarge more.
Reza Akbarian; Seyyed Mohssen Heydaripour
Volume 9, Issue 34 , October 2009, , Pages 43-63
Abstract
The aim of this paper is to investigate the effect of financial market development on economic growth in the context of the Iranian economy in short and long-run over the period 1966–2007. Two financial developments indices (rate of financial saving to GDP and rate of domestic credit to GDP), has ...
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The aim of this paper is to investigate the effect of financial market development on economic growth in the context of the Iranian economy in short and long-run over the period 1966–2007. Two financial developments indices (rate of financial saving to GDP and rate of domestic credit to GDP), has been used in two separate econometric models "Auto-Regressive Distributed Lag (ARDL)" in order to investigates the effects of financial market development on the economic growth. In order to explain the private sector behavior, the rate of claims on private sector to domestic credit has been used as an independent variable.
The empirical results in two models suggest that in the short and long run, the financial development has negative effect on economic growth. This result supports the opinion about negative effect of financial development on economic growth in developing countries with a weak control on loans. In both models the influence of openness on economic growth is positive. The results also show the economic adjustment policies had negative effect on economic growth.
