Shahram Fatahi; Abolghasem Golkhandan
Abstract
This study investigates the causal linkages between insurance (divided between life and non-life insurance) and globalization in Group D8 countries by focusing on country-specific analysis for the period 1999–2011. For this purpose, we have used the penetration rate of life and non-life insurance ...
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This study investigates the causal linkages between insurance (divided between life and non-life insurance) and globalization in Group D8 countries by focusing on country-specific analysis for the period 1999–2011. For this purpose, we have used the penetration rate of life and non-life insurance and KOF globalization index (as a proxy of globalization) as primary variables. The method used in this study is based on the panel causality test provided by Konya (2006). This method is based on the Seemingly Unrelated Regressions (SUR) model and Wald tests with the country specific bootstrap critical values. Also, this test accounts for cross-dependency and heterogeneity among the members of the panel. Experimental results show that the causality between life and non-life insurance and globalization are not the same in different countries of D8 group, when considering their particular circumstances. For the case of Iran, only a one way causality from the globalization to non-life insurance is verified.
Maryam Hemmaty; Mehdi Pedram; Hossein Tavakolian
Abstract
Empirical studies done in the area of price stickiness imply that the frequency of price change is high in Iran. In other words, prices change quickly after a monetary shock hits the economy. On the other hand, based on empirical studies, monetary shocks have a lagged effect on inflation in Iran. This ...
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Empirical studies done in the area of price stickiness imply that the frequency of price change is high in Iran. In other words, prices change quickly after a monetary shock hits the economy. On the other hand, based on empirical studies, monetary shocks have a lagged effect on inflation in Iran. This paradox can be explained by the existence of information stickiness in Iranian economy. Over the past two decades, many studies on the importance of the information stickiness and its role on the formation of expectations have emerged. Recent work on rational expectations models with informational frictions such as Mankiw and Reis (2002) have emphasized how informational rigidities can lead to policy prescriptions that differ from those under models with full-information. So, examining the existence of sticky information and understanding the degree of this kind of rigidity is very important. No empirical study has been done yet to estimate the degree of information rigidity in Iranian economy. In order to fill this gap in the literature, following the approach proposed by Khan and Zhu (2006) and Coibion (2010), We estimate the key structural parameter of sticky information Philips curve (SIPC) – i.e. the degree of information stickiness- for Iran. Based on the results, the null hypothesis of “no information stickiness” is rejected and this can be inferred as confirmation of sticky information in price-setting behavior of firms in Iran. Our estimates show that price-setting firms in the economy update their price-relevant information on average every 2 quarters.
