Volume 18, Issue 2 (2018)                   QJER 2018, 18(2): 1-20 | Back to browse issues page

‎ 20.1001.1.17356768.1397.18.2.2.1

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Khanzadi A, Heidari S, Vafamand A, Derakhshan M H. Analyzing the Effects of Inflation on Relationship between Financial Development and Employment in Iran by Using STR Logistic Model (LSTR). QJER 2018; 18 (2) :1-20
URL: http://ecor.modares.ac.ir/article-18-13590-en.html
Analyzing the Effects of Inflation on Relationship between Financial Development and Employment in Iran by Using STR Logistic Model (LSTR)
Azad Khanzadi1 , Samira Heidari * 2, Ali Vafamand3 , Mohammad H. Derakhshan4
1- Assistant Professor, Department of Economics, Razi University
2- M.Sc. in Economics, Tutor at PNU and Islamic Azad university , Samiraheidari67@gmail.com
3- Ph.D. student of Monetary- Financial Economics, Tabriz University
4- Ph.D. student in Applied Mathematics, Shahrekord University
Abstract:   (11098 Views)
Development of financial markets plays a major role in economic development. The present study estimates the effect of inflation on the relationship between financial development and employment using STR smooth transition regression model in Iran during 1992-2014. The results show that when inflation increases beyond threshold level, quasi-money negative effects on unemployment rate are intensified, and an increase in quasi-money has greater effect on increase in employment. Furthermore, increase in inflation rate and passing threshold level, and increase in capital market volume and domestic credit granted to private sector result in decreasing employment rate. The effect of monetary base on unemployment rate is positive in both regimes, but higher inflation (passing the threshold level of inflation) has intensified the positive effect of monetary base on unemployment rate. In other words, an increase in inflation rate has increased the monetary base, which in turn has reduced the employment level.
Keywords: Inflation, Financial Development, Employment, Smooth Transition Regression Model (STR)
Full-Text [PDF 1061 kb]   (4284 Downloads)    
Article Type: Research Paper | Subject: Economics
Received: 2016/04/4 | Accepted: 2017/07/23 | Published: 2018/06/24
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