Sorayya Rafiee; Karim Emami; Farhad Ghaffari
Abstract
Banking system, as one of the most important parts of macroeconomy, plays a vital role in general economic equilibrium and transition of economic shocks in the society. Because of that, it is of sensitive role in national economy. In addition to implementing dictated monetary policies of central banks, ...
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Banking system, as one of the most important parts of macroeconomy, plays a vital role in general economic equilibrium and transition of economic shocks in the society. Because of that, it is of sensitive role in national economy. In addition to implementing dictated monetary policies of central banks, they as any economic business, pursue the goal of increasing their profitability. In this study, we use Dynamic Stochastic General Equilibrium (DSGE) and take into account five economic sectors, namely households, entrepreneurs, mediator banks, distributors and government, to study the reaction of banks to emergence of monetary shocks. For this purpose, the authors seek to make use of long-term macroeconomic parameters. The results of our model show that, upon emergence of a positive shock on interest rate, due to the decrease of request for loan and the amount of lent money, the rate of loaning and as a result, the profit of banks is reduced, and in the case of a positive oil shock, the amount of market liquidity increases so the rate of loaning decreases and the scale of investment increases and finally, the households’ willingness to save is reduced. Therefore, the outcome of decrease of lending rate and decrease of deposits leads to a reduction in banks’ profitability.
seyyed parviz jalili kamju; ramin khochiani
Abstract
Based on economic structure of a country, defense spending and security costs as a public good, can have a positive or negative impact on private sector activities. This research applies a partial coherence approach for the period 1959-2017 to evaluate the relationship between defense spending and security ...
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Based on economic structure of a country, defense spending and security costs as a public good, can have a positive or negative impact on private sector activities. This research applies a partial coherence approach for the period 1959-2017 to evaluate the relationship between defense spending and security costs as two important parts of the state budget, with the formation of a fixed private capital and oil revenues with a constant tax effect. The results showed that by keeping the effect of tax revenues as fixed in four-year time scales, and in the period 1969-1978, defensive expenditures and the formation of fixed private capital were not co-phase and defense expenditure was a leading variable for the formation of fixed capital, which shows a confirmation of crowding-out effect in Iranian economy. In contrast, in period 1989-1997, these two variables are co-phase and no crowding-out effect has occurred. Also, in short- and long-term, the formation of private fixed capital is a leading variable that justifies the need for security and increasing its costs. During period 1969-1978, in the short-term, two variables of defense spending and oil revenues are in opposite phase. The two variables of security costs and oil revenues are in co-phase in the short run and the phasic difference arrows indicate the causality of oil revenues to security costs during the years 1986-1999. Based on the structure of Iranian economy and the fact that Iran does not export military equipment, it is suggested that defense spending be optimized in order to control the crowding-out effect and security costs to be increased to the point that they have a positive impact on the formation of private equity.
Marzieh Bahmani; Hosein Raghfar; mir hossein mousavi
Abstract
Macroeconomic fluctuations and demographic changes have led to problems in Iranian retirement funds and lack of sustainability in their resources and expenditures. Because of ageing population and the effect of inflation on depreciation of pension funds’ reserves, it is imperative to carry out ...
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Macroeconomic fluctuations and demographic changes have led to problems in Iranian retirement funds and lack of sustainability in their resources and expenditures. Because of ageing population and the effect of inflation on depreciation of pension funds’ reserves, it is imperative to carry out parametric reforms such as a reduction in the replacement rate. The purpose of this study is to examine the effects of reducing replacement rate on macroeconomic variables. The model used in this research is based on overlapping generations general equilibrium approach with an emphasis on imperfect labor market. Our findings show that ageing population leads to a reduction in interest rate (%4), a shortage of young workers and a rise in wages (%20) in labor market. In Addition, ageing of population will increase the cost of the pension system (%7). A parametric reform of reducing replacement rate (0.2) leads to reduction of pension system costs (%2). It also leads to a reduction in interest rates (%4.8). In long-run, reducing replacement rate leads to increase in capital accumulation and saving.
tayebe chaman; parisa mohajeri; Ali Arabmazar Yazdi
Abstract
The purpose of this paper is to identify factors affecting tax evasion with emphasis on financial development. For this purpose, we estimate an ARDL model for the period 1978 to 2014. Our results show that, at first, there is a long-run relationship between tax evasion and explanatory variables (financial ...
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The purpose of this paper is to identify factors affecting tax evasion with emphasis on financial development. For this purpose, we estimate an ARDL model for the period 1978 to 2014. Our results show that, at first, there is a long-run relationship between tax evasion and explanatory variables (financial development, literacy rate, government size and industry value added (%GDP). Secondly, financial development has a significant negative effect (in short-run and long-run) on tax evasion. In other words, higher financial development leads to lower tax evasion. This finding is consistent with the theoretical expectation. Thirdly, literacy rate, government size and industry value added (%GDP) have a significant negative effect on tax evasion. That means tax evasion is decreases by increasing each of them. Also, the variables of GDP per capita and tax complexity did not have a significant effect on tax evasion.
alaeddin ezoji; Abbas Assari Arani; mohmmad reza vaeze mahdavi; GholamReza K. Haddad
Abstract
The relationship between human capital and labor productivity is always important for economists. Considering the relationship between these two will also be remarkable in microeconomic studies. Meanwhile, the impact of different dimensions of human capital on labor productivity can be a measure ...
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The relationship between human capital and labor productivity is always important for economists. Considering the relationship between these two will also be remarkable in microeconomic studies. Meanwhile, the impact of different dimensions of human capital on labor productivity can be a measure of actual effect of human capital on productivity. The aim of this paper is to examine the effects of various dimensions of human capital (education, health, and experience), on labor productivity based on individual characteristics in Iranian economy. We use micro data (Cost–Income Survey of Urban Areas - 2013) and estimation of Quantile Regression (QR) econometric technique. For this purpose, net income (wage and salary) for employment in private sector is used as proxy of labor productivity. Our results show that in different quantiles, all three dimensions of human capital have a positive and significant effect on productivity of labor force employed in Iranian private sector. Meanwhile, in different quantiles, health indicators of human capital are more volatile than other dimensions of human capital, i.e. education and experience. So, in lower quantiles (Ql), the response of labor productivity to health indicators is more than higher quantiles (Qh). Because of that, any kind of health shock may have a greater effect on labor productivity in lower-income groups. This result shows the importance of health capital in social security, insurance and health systems and reminds us to improve the productivity of working people by means of better health capital.
Mohammad Bamani Moghadam; mostafa pouralizadeh; Hadi Esmaeilpour Moghadam
Abstract
The purpose of this study is to determine an optimized stock insurance contract in Tehran Stock Exchange. First of all, based on a financial management problem, a risk management contract is designed to minimize the risk of loss that an agent might face. Then, with a mathematical modeling, we will see ...
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The purpose of this study is to determine an optimized stock insurance contract in Tehran Stock Exchange. First of all, based on a financial management problem, a risk management contract is designed to minimize the risk of loss that an agent might face. Then, with a mathematical modeling, we will see that to efficiently manage the stock risk, we need to make sure that only multi-layer contracts, or equivalently, European call options are correctly valued. Therefore, the optimized insurance contract is determined by correct pricing of European call options. Studying more deeply in this area by implementing the proposed algorithm on Tehran stock exchange shows that the optimized value of the insurance contract is a small percentage of the stock initial price; furthermore, it is also a function of the stock return fluctuation. Hence, the volatility and the price of insurance contract are positively correlated. In other words, the more a stock is volatile, the more expensive is an insurance contract.
Habib Shahbazi; Hossein Moradimokhles
Abstract
In economic growth and development literature, the role of human capital and its development is always considered with great importance. One of the most important types of education in human capital creation is primary (elementary and secondary) education, which is invested by public sector and since ...
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In economic growth and development literature, the role of human capital and its development is always considered with great importance. One of the most important types of education in human capital creation is primary (elementary and secondary) education, which is invested by public sector and since primary education has comprehensive role for society, it is also referred to as general education. Therefore, the role and contribution of public education on GDP and economic growth is one of the fundamental questions for economists in the field of education. There are always many questions about general education. For example, given the budgetary constraints, how much investment should be made in the field of public education? What is the impact of investment and budget allocation to this sector on economic growth? Does spending in public education has led to development of human capital? Do the educational conditions i.e. economies of scale in education and society conditions i.e. risk-taking of individuals affect the impact of general education on human development? These questions are addressed in this paper, with the focus on the effects of different risk-taking scenarios and economies of scale in education on human capital development and economic growth. In this research, we have further developed Teles and Andrade (2008) model to examines the contribution of government public expenditure on primary and secondary education (Ministry of Education) on economic growth in Iran based on various risk-taking and economies of scale in educational scenarios for year 2016. Based on our results, the average contribution of general education on economic growth was 1.141 percentage points with different exact values in different risk-aversion scenarios. But with decreasing risk aversion, primary education contribution on economic growth will increase. In different situations, the effect of general education on economic growth has always been positive but when there is a decreeing return on human capital in national production, there is a negative contribution for risky people. A 1.141 percentage point of primary education contribution to economic growth indicate that 13.7 percent of economic growth in year 2016 (3.8 percent) was the result of investing in primary (elementary and secondary) education.
Ahya Eyvazi
Abstract
In mainstream economics, "distribution" is one of the issues which is ignored because of being unresolved, and a new issue is propounded. First, the "functional distribution of income" was proposed, which is based on the determination of the share of production factors (at the micro level). Then, due ...
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In mainstream economics, "distribution" is one of the issues which is ignored because of being unresolved, and a new issue is propounded. First, the "functional distribution of income" was proposed, which is based on the determination of the share of production factors (at the micro level). Then, due to lack of proper response, from the early twentieth century, ideas changed to explain the new concept of "personal distribution of income" which is based on the income allocation among the households and individuals (at the macro level). In fact, the important question around the functional distribution of income which we are seeking to answer is "Who is the owner of the surplus value or the profit (positive and negative) in the production?". Shahid Sadr properly understood the importance of income and wealth distribution in leading the Islamic society towards its goals of justice. In his “Eghtesadona” book, he has extracted the system of "functional distribution of income," and the correct answer to this issue, in addition to the "personal distribution of income" based on the teachings of Islam. In this distributional system, interactions are not homogeneous and the basis for the share of factors of production is contracts and rules, which depends on real conditions of the economy. In this paper, the "distribution" issue in conventional economics is compared with the concepts developed by Shahid Sadr, using the comparative and library methods.
