Journal of Economic Modeling Research

The Effect of the Natural Resources Abundance on the Governance Preformance in the Selected Oil Exporting and Developed Countries (A Panel GMM Approach)

Abolfazl shahabadi

Natural resources as wealth in general and oil and natural gas in particular can have a potentially beneficial impact on the economic prosperity. However, economic experience implies that many of the major oil exporting countries are facing instability in economic growth, Dutch Disease, corruption and under- development. Owing to the fact that natural resources can play a vital role in development, the present study tries to investigate the econometrics relationship between export of natural resources (as a proxy for abundance) and governance indicators (as alternative variables for institutional development) in selected oil-exporting and OECD countries through the application of Generalized Moment of Method (GMM), for the period lasting from 1996 to 2011. Findings of the study revealed that the strong and statistically significant evidence confirms the negative impact of the export of natural resources on the governance index, quality of regulations, rule of law and control of corruption in the selected OPEC’s member countries. Nevertheless, such a negative impact does not have any statistically significant strength in developed countries. This is due to the improvement made in the surveillance, technical and executive mechanisms of the institutions in the selected OECD countries. It seems that the enormous incomes accrued from the export of natural resources in the oil producing countries in question will induce a decrease in transparency and accountability, instability and frequent changes in economic policies, extension of rent-seeking, corruption and authoritarianism.

The Estimation of Co2 Storage in Form of Sustainable Ramsey Model in Iranian Economy

azadeh akhtari

Due to the potentiality of the accumulation of atmospheric carbon dioxide and its permanent nature, the actual amount of carbon dioxide in the atmosphere, the accumulation of effective per capita carbon dioxide and the accumulation of effective per capita of this pollutant in the steady state has been estimated estimated through Kalman filter approach in a Ramsey equilibrium model over the period of 1991- 2007 for Iran. Thereby the researchers were able to estimate parameters such as the coefficient of environment cleaning for carbon dioxide, the share of fossil resources in production, the rate of time preference and the elasticity of emission function with respect to reduction activities.
The empirical results of the study concerning the minimum, equilibrium & maximum rate of the coefficient of environment cleaning, indicate that for 1991 to 2007 in Iran the elasticity of fossil energy in production function is 0.4475, the rate of time preference is 0.12, the elasticity of emission function with respect to reduction activities is 4.45 and the coefficient of environment cleaning for carbon dioxide is 0.02. The effective per capita accumulated co2 & effective per capita accumulated co2 in steady state with the coefficient of seasonal cleaning of 0.02 respectively have the average of 50.45, 52.97 metric ton based on constant 2005 (PPP). Also the average of effective per capita consumption of the fossil fuel energy and the effective per capita capital in steady state are respectively 4.468 kg and 6.56 $ based on constant 2005 (PPP). The surpassing of the average value of the accumulation of carbon dioxide in steady state compared to its accumulation average value indicates that the accumulation path of co2 will have an increasing trend in next years.

The Effects of Oil Shocks on Macroeconomic Indices in Iran (Structural Vector Error Correction Analysis)

Hosein Sharifi-Renani

The main objective of this study is to investigate the effects of oil shocks on GDP, prices level, money and exchange rates in Iran by using the structural vector error correction (SVEC) approach model covering the period 1980Q2-2010Q1. The findings of this study reveal that positive shock in oil real price has significant and positive effect on the real GDP in the short, medium and long. The impact of oil price shocks on domestic prices in the short, medium and long term is negative and significant, such as creating a positive shock to the real price of crude oil, reduce the domestic price. In addition, a positive shock to the real price of crude oil has the negative effect of the exchange rate in the short, medium and long term. However, the impact of oil price shock on the real exchange rate is permanent. Imports also will increase, due to the increase in wealth and demand for intermediate products. On the other hand, a positive shock to the real residual money in the short run cause to immediate increases in real out put.

The Study of Transportation Infrastructures Development's Effect on Economic Growth in Iran’s Provinces

mahla afshar pour

Transportation has been one of the human primary needs and it has been found a wider range with the economic and social development, today it’s considered as a symbol of civilization. It is one of the infrastructure sections in every society that, it not only influences on the development process but also will be changed during development. So, this study investigated the effect of transportation infrastructure on economic growth in some of Iran's provinces by using of panel data model and data from 2000 to 2011. The results indicate that transportation infrastructure as a variable had a positive effect on economic growth. Moreover, provinces that had more populations could help the promotion of the economic growth by changing the underlying structures such as the transportation capacity and the quality of the transportation systems.

Market Power and Cost Efficiency in Iran’s Banking Sector (NEIO Approach)

mohammad nabi shahiki tash

This paper based on the new empirical industrial organization model (NEIO) examines the impact of market concentration and cost efficiency on bank's profit rate margin in Iran. The study uses the model developed by Azzam (1997) to evaluate the market power and cost efficiency for 15 active banks in the banking industry. The empirical findings indicate a decrease in the market power of banks during the period 2001-2011. It is also shown that the conjectural variations index associated with the loans is -0.96, while demand for the loans is completely inelastic where its value is near to 0.087. Additionally, The market power and cost efficiency in the banking industry have been estimated 0.37 and -0.30 respectively meaning a decrease about 0.3 percent for the bank's profit rate due to the efficiency of cost and an increase about 0.07 percent due to the concentration.

The Impact of Energy Price Increase on Employment: A CGE Approach

Alimorad Sharifi

Energy carrier’s subsidization has placed a significant pressure on government budget in Iran thus, energy price increase is performed in order to ameliorate this case. One of the main challenges that policymakers need to consider is the impact of energy prices increase on the labor market especially, when the national unemployment rate is high. This paper utilizes a computable general equilibrium model based on a Micro Consistent Matrix for 2006 in order to evaluate the impact of energy price increase on the Iranian labor market during 2006. The empirical results are based on two scenarios: Baseline and FOB price increase scenarios. They show that the activity level and demand for labor in “crude oil, natural gas, and coal” as well as “other services” sectors will increase in short-run while the energy carriers’ prices increase. However, in long-run, the labor increment will be lower. Furthermore, the model results indicate that in short-run, the activity level and demand for labor in the other sectors will decrease. On the other hand, the policy will result in a larger decrement in the activity level and demand for labor in these sectors in long-run.

The Effect of Real Exchange Rate Volatility on Exports of Industrial Goods (Saikkonen & Lutkepohl Approach)

Iran’s share of world exports has not been great in recent years and the development of non-oil exports such as exports of industrial goods in order to reduce the economy's dependence on oil revenues made necessary. The real exchange rate is one of the most important variables affecting exports. In this context, investigate the effect of the real exchange rate volatility on different variables such as the export is important. The main objective of this paper is to investigate the impact of real exchange rate volatility on exports of Iran Industrial goods over the period of 1968-2010. To that end, The real exchange rate volatility index has been estimated incorporating with EGARCH (0,1) model than we using co-integration of Saikkonen & Lutkepohl and FMOLS to investigate the impact of the real exchange rate volatility index, along with other variables of model exports of industrial goods have been evaluated.
The main empirical finding of this paper show that the real exchange rate volatility variables and export prices have negative and significant effects on exports of industrial goods and variables GDP’s world, GDP’s Iran and trade of openness have positive and significant effects on exports of industrial goods. The empirical findings of this paper, The beneficial implications for investors and Policy makers needs to recognize the exact effects of exchange rate volatility on exports of industrial goods are provided.