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Expansion, utilization and distribution of potential economic opportunities among people have important impacts on the prosperity of each country. Simon Kuznets was the first researcher who systematically examined the relationship between economic growth and income distribution based on the statistical data. According to Kuznets, income inequality will decrease by economic growth in the long term. Therefore, economists focused on economic growth in order to reduce income inequality. However, the Kuznets hypothesis was faced with a serious challenge by publication of Piketty's “Capital” in the twenty-first century. Since, according to Piketty, not only income inequality has not diminished, but also it has increased unprecedentedly in the advanced stages of economic growth and development. In this regard, the aim of this study is to investigate the Thomas Piketty's hypothesis based on the statistical evidence of Iran by using the ARDL econometric method during the period 1975-2015. The results confirm Thomas Piketty's hypothesis according to statistical evidence of Iran. In addition, the effect of non-oil GDP on income inequality is negative and significant, but the impact of oil revenues is positive and significant. War has also led to increased income inequality.

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Formation of institutions depends on leaders and elite’s beliefs. Some factors influence the beliefs of people. The aim of this study is to identify beliefs affecting the formation of efficient institutions. In this research, the knowledge has been generated by the method of inductive qualitative content analysis, based on the lives of the six persons who have been introduced the experts as influential people in the formation of successful economic institutions. Based on the content analysis of the interviews, the self-efficacy beliefs have positive effects on the formation of efficient institutions, and skills and experiences affect the beliefs. Of two factors influencing self-efficacy belief, the experience of domination (impact of life circumference, and experiences of childhood and teenage) is of high scores in the first three persons than three next ones; however the substitution experience (impact of parents) is similar among sample under study. All six experts had good socioeconomic positions.
 

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In the orthodox economy, domestic and foreign security is one of the tasks of the welfare state and even of the minimalist state to protect private property rights. Military expenditure dependent on the stage of economic development may affect real economic variables differently. Within four models, this study uses wavelet coherence approach to assess the relationship between public order and military expenditure with oil revenues and private investment in Iran during the period 1959-2017. The results of the first model show that at four-year and 16-year time scales during the period 1969-1978, the growth of military expenditure and the growth of oil revenues are not only the co-phase but also the growth of oil revenues is a leading variable for the growth of military expenditure. The results of second model indicate that there is a coherence between the public order expenditure growth and the oil revenues growth in four-year horizons during 1960-1978, and they are also co-phase from 1997 to 2005. At time scales up to 8 years during 1993-2008, another type of relationship is observed. These variables are co-phase, but the public order expenditure growth is not a cause of oil revenues growth. The results of the third model show that the private investment growth and the public order expenditure growth act against each other, but they are co-phase in the long-run. The results of the wavelet power spectrum also show that the greatest energy of both periods is due to public order and military expenditure growth in the pre-revolution period.
 

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This study aims to investigate the percentage of households facing catastrophic health expenditure and the impoverishment index before and after the implementation of the Health System Reform Plan (HSRP) in rural and urban areas of Iran. This research is based on statistical inference, life-cycle theory and pseudo-panel approach, which uses household income-expenditure survey data during 2014-2017. Using the STATA-SE13 and Excel softwares, households were categorized in 10 age groups of households’ heads born between 1944 and 1993 within five-year intervals. The indexes were calculated in weighted and non-weighted cases for total households, and households having health expenditure. After the implementation of HSRP, the percentage of households with catastrophic health expenditure remained relatively unchanged and impoverishment index decreased slightly. In 2015, both rural and urban households having health expenditure in non-weighted case were faced to the least catastrophic expenditure and the least impoverishment index. Totally, rural and urban areas with elderly household-heads experienced the highest catastrophic health expenditure and impoverishment rate.

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The expansion of underground activities and smuggling of goods threats the employment in Iran. This study estimates the volume of smuggling in Iran by using multiple-cause-multiple causes (MIMIC) model and applying maximum likelihood method over the period 1979-2017. Then the effect of smuggling on employment is investigated by using ARDL Bounding test method. The results of smuggling time series show that despite some fluctuations, the smuggling has been generally increasing. The findings of regression model indicate that expansion of smuggling has a negative impact on employment in the short- and long-run.

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The purpose of this paper is to estimate the direct effect of foreign investment on economic growth in agriculture, industry and services sectors in the provinces of Iran during the period 2001-2017. For this purpose, the Panel Smooth Transition Regression (PSTR) model used. It was found that there is a nonlinear relationship between foreign direct investment and the growth of various economic sectors. The results of this study indicate that foreign direct investment affects differently the growth of various economic sectors due to fluctuations in inflation rates. The estimated coefficients for the inflation rate threshold in three-menthioned sectors were 2.55, 1.78 and 1.94, respectively. In addition, one-percent increase in foreign direct investment would increase the growth rates of agriculture, industry, and service sectors by 0.50%, 0.69% and 0.88%, respectively.

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The purpose of this article is to investigate the relationship between quantity and quality of children in Iran. The quantity-quality models of fertility primarily assume that there is a substitution relationship between quantity and quality of children. The ambiguity in sign and final effect of newborns on the quality of existing children and the linearity or nonlinearity of such effect led us to investigate the relationship between quantity and quality of children in Iran. In this context, by using cross-section expenditure and income data of urban households in 2015, first we draw out a sample of 5624 children over 25 years of age in urban areas. Then, we investigate the relationship between quantity and quality by applying OLS method with Huber-White robust standard errors. The results show that there is significant, negative, and nonlinear relationship between family size and quality of children, but the size and sign of this relationship are not the same for all children, that is for first, second, and third births there is a complementary relationship between quantity and quality of children, and for births of more than three children there is a substitution link between quality and quantity of children. According to the results, we recommend that the population growth policies consider the size of families. If the policy of population growth focuses only on small families having no children or those having less than three children, population growth will not be detrimental to its quality and will improve the human capital of society.

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Macroeconomic policy makers and planners always use different tools to achieve economic goals. Credit control is one of these tools. The boom and recession of the financial sector of the economy are called the credit cycle, and of the real sector is called the business cycle. Credit as a complementary input for capital, intermediate goods, and primitive materials can be effective in improving business cycles. This study, by employing Structural Vector Auto Regressive (SVAR) model and using the annual data of Iran during 1973 to 2016, investigates the relationship between credit cycles and business cycles in Iranian economy. The results show that credit cycle has positive effect on business cycle, but business cycle has negative effect on credit cycle. Credit cycle fluctuations have the largest share in explaining the business cycle fluctuations, but business cycle ranks the fourth in explaining the credit cycle fluctuations following own variable, inflation rate and consumption shocks. The investigation of the co-movement between the credit cycle and the business cycle also show that the effect of the credit cycle on the business cycle is revealed from the second period and there is 24 years of co-movement between these cycles. Also, the persistence of the co-movement between these cycles in expansion - improvement phases has causes severe financial crises in the Iranian economy in the long run.

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Economic complexity reflects the capabilities of a country and determines the level of economic growth and development. Investing in knowledge and human capital due to increasing the capabilities of economic actors is essential to achieve a complex economy. This paper examines the relationship between human capital and economic complexity in Iran during 1971-2017. Empirical analysis shows that primary school enrollment has no significant correlation to economic complexity. In addition, R&D expenditure as percentage of GDP has no significant relation to economic complexity. According to Johansen-Juselius co-integration test there is no co-integrating relationship between the variables under study. However, government expenditure on tertiary education as percentage of GDP, shown by TR, is co-integrated with economic complexity. Based on Granger causality test, there is a unidirectional causality from TR to economic complexity. Impulse response analysis indicates that economic complexity responses to TR after three years. If spending on higher education increases by 10 percent, the economic complexity index will increase by 11 percent.

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The interaction between institutional quality and the mechanism of oil shock diffusion might have a significant effect on macroeconomic dynamics in an oil-exporting country. The literature lacks a formal model to address the role of institutional quality in the economic performance of an oil-rich developing economy. Using a new Keynesian dynamic stochastic general equilibrium (DSGE) framework, this study develops a model to investigate the response of macroeconomic variables to changes in institutional quality resulted from oil shocks in Iran as an important oil-exporting country. Our modeling allows us to show how institutional quality and oil revenues affect households, firms, government, and the central bank. The model is solved and calibrated for the period 1959-2017. The results indicate that the destruction of institutional quality caused by a positive oil shock prevents the Iranian economy from reaping the fruits of an increase in oil revenues. Oil revenues and their shocks by destroying the institutional quality through the expansion of rent-seeking ‎activities, increasing transaction costs of production, reducing the impact of government spending, and ‎diverting monetary and fiscal policies from the targets result in negative effects on Iran's non-oil ‎production in the long run.‎ To reduce the destructive effects of oil shocks on institutional quality in the Iranian economy, we suggest the policymakers in Iran reduce the dependency of the government budget on oil revenues.

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This study aims to measure magnitude of capital flight from Iran by employing Ndikumana and Boyce (2003) method during the period 1976-2018. In order to check the existence of long-run relationship between capital flight and its determinants, it applies the Bounds Testing Approach developed by Pesaran et al (2001) within a general-to-specific econometrics methodology. Then, it applies the Autoregressive Distributed Lags approach to estimate the short run and long run behavior of capital flight from Iran. The results show that capital flight has high records during the first years of the Islamic revolution and the eight-year war between Iraq and Iran, so that the highest capital flight (141.1 billion dollars) has been estimated for 1979-1980 fiscal year. In addition, the findings indicate that the highest and lowest capital flights have been estimated in 2011 and 1997, respectively. In recent years, capital flight has been increasing due to sharp exchange rate fluctuations. Moreover, increases in inflation and the government fiscal deficit significantly contribute to capital flight and the increase in net foreign exchange reserves reduces the capital flight.

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The growing trend of international trade reinforces the interdependence of countries, and consequently amplifies the effects of exchange rates movements on the countries’ real sectors. The main channel for this effect is domestic prices. According to the empirical evidences, effects of exchange rate growth on prices, i.e., Exchange Rate Pass-Through (ERPT), vary across the products and firms. This paper explores factors explaining the difference in ERPT among the products and firms. To do so, price data of 2369 products from 355 Iranian firms listed in the Tehran Stock Exchange is used during 2006: Q1 to 2019: Q1. The panel estimation results show that current and lagged effects of the exchange rate on the prices are positive and significant, on average, and the lagged effect is larger than the current one. Moreover, the findings indicate an increase in import intensity and the market share of the firms lead to increase in the firm’s ERPT. Also, an increase in price led by exchange rate shock is larger in the firms with a higher degree of export orientation and strict financial constraint. However, state shareholding in firms induces decrease in ERPT only in firms with high import intensity and market share.

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As higher education plays an exceptional role in training skilled and creative labor force, today, not only developed countries but even many developing countries devote a major share of their GDP to higher education, intending to expand both quantity and quality of their higher education to speed up the trend of growth and development. In this article, applying the data envelopment analysis (DEA) model, first the efficiency of Iranian higher education is investigated with respect to sustainable development and environmental considerations. Then, applying the autoregressive distributed lags (ARDL) model, the efficiency of Iranian higher education is evaluated with respect to realization of a continuous growth during 1990-2015. The results of the first model show an inefficient performance of Iranian higher education with respect to sustainable development. The second model indicates the following results: First, that the increase of productivity in higher education has a positive and significant influence on economic growth. Second, that investment in higher education has a positive impact on economic growth after two lags, showing that in higher education long run policies are more effective on economic growth than short run ones. Third, that the investment on higher education is less effective on economic growth than investment on public education.   

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In recent decades, due to the importance of future values of macroeconomic variables, a range of predicting methods and models has been studied and evaluated. The main purpose of this paper is to compare different methods of predicting Iran's economic growth using seasonal time series data during 1990-2017. To this end, economic growth is predicted using dynamic model averaging (DMA), dynamic model selection (DMS), BMA, BVAR, TVP and AR models in three prediction horizons (one, four and eight seasons). The models used in this study are categorized into three spectra, large-scale (including 112 variables in nine factor blocks), average-scale (including 10 variables) and univariate models. The results show that the predictions of DMS and DMA are more efficient than other traditional prediction. 

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This study attempts to investigate the effect of government spending on regional growth in Iran. The relationship between government spending and economic growth is one of the well-known topics in economic literature. One of the problems of developing countries is the failure to achieve sustainable economic growth, which not only causes economic problems such as recession and unemployment, but also cultural, political and social problems. The government economic stabilization policies can be used to narrow the gap between the potential and realized product and to maintain the product near its potential level. One key issue in the field of regional planning is to study and understand the geographical inequalities in different dimensions.  In this paper, using the spatial econometric method, the relationship between government spending and regional growth is estimated by applying the regional data of Statistical Center of Iran during 2001-2017, and Excel and R software’s are used to perform the calculations. This study seeks to explain the growth of different regions using government spending, and to answer these questions:  Does government spending have a significant effect on growth in the regions? Do the regions converge in terms of economic growth over time? The results indicate the negative effect of government spending, population growth and human capital on regional growth in Iran. In addition, the statistical significance of spatial correlation coefficient indicates the positive diffusion effects of regional economic growth.



 

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The study of speculators' behavior is very important in explaining the phenomena of the Iranian housing market. Many of the unfavorable phenomena that occur in this market are the results of speculative activity in the housing market. Speculators enter the market at the beginning of the boom period and earn maximum profit of price increases, and as signs of recession appear, they quickly exit the market and invest in parallel markets such as banks, stocks, exchange and gold, which leads to fluctuations in housing prices. In this study, following the Roehner model and using the time varying parameter ordinary least squares method (TVP-OLS), the speculation index in the housing market during the period 1991 to 2020 was estimated, and then the impact of different shocks to stock market, exchange market, gold market, interest rates and housing tax on speculation in the housing market was investigated, and for estimating the effects of these shocks, the Markov-switching vector autoregressive (MSVAR) method was used. The results show that during the period under study, on average, 20% of the increase in housing prices was related to speculation, with the highest growth in 1997 at 320% and the lowest growth in 2005 at -23%. According to the results of the Markov-switching vector autoregressive model (MSVAR), speculation in the housing market had the highest response to the exchange and gold markets, and interest rates and the least response to the stock market and housing tax.

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