Mohammadgholi Yousefi; Bahman Khadam
Abstract
The purpose of this study is to find the main determinants of stagflation in Iranian manufacturing sector during 1982-2012. We have used the data of manufacturing industries, categorizing them into three groups of resource base, low technology and medium and high technological industries. We have used ...
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The purpose of this study is to find the main determinants of stagflation in Iranian manufacturing sector during 1982-2012. We have used the data of manufacturing industries, categorizing them into three groups of resource base, low technology and medium and high technological industries. We have used logit regression with fixed effect, taking industries utilizing less than 50 percent of their nominal capacity and having more than 20 percent disguised unemployment in addition with having capital–output ratio of over 3o percent as industries suffering from stagflation. If a manufacturing industry was suffering stagflation, its dependent variable was given a value of 1 and the dependent variable of other industries was set to zero. Our explanatory variables include the imports of intermediate goods, wage costs, labor productivity, interest rates, exchange rate and oil revenue. Our findings show that all the variables with the exception of labor productivity had expected signs and their coefficients were statistically significant. The results show that, while as expected, the coefficient of labor productivity was negative, however, the coefficients of other variables were positive and significant implying positive impact on stagflation.
Mohammadgholi Yousefi; Bahman Khadem
Abstract
The purpose of this paper is to estimate disguised unemployment in Iran manufacturing industries. For this purpose, we have used a dynamic employment model. The labor requirement frontier was approximated by applying Frontier Analysis method and translog cost function. The model is applied to a panel ...
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The purpose of this paper is to estimate disguised unemployment in Iran manufacturing industries. For this purpose, we have used a dynamic employment model. The labor requirement frontier was approximated by applying Frontier Analysis method and translog cost function. The model is applied to a panel of nine groups of Iranian manufacturing industries based on two-digit ISIC classification for the period 1995-2012. We define disguised unemployment as the difference between optimal employment and actual employment. To find optimal employment we have used employment frontier function and we have defined optimal employment as the minimum labor requirement for a specified level of output. Our findings show that on average, disguised unemployment was more than 47 percent of total employments in manufacturing industries. However, this proportion was higher in group of “miscellaneous industries” (75 percent), followed by “nonmetallic minerals” (74/8 percent), but it was much lower in “textiles, apparel and leather industries” (2 percent) and “woods and furniture industries” (6 percent). In industries as important as “machinery” and “transport equipment”, disguised unemployment was around 58 percent. These findings seem reasonable, stemming probably from under-utilization of capacity in manufacturing industries.
