Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Examination of Real Shocks and Production Fluctuations of Iran’s Economy Examination of Real Shocks and Production Fluctuations of Iran’s Economy 17 30 3031 FA Nader Mehregan Professor of Economics, Bu-Ali Sina University, Hamedan, Iran Ezatollah Abbasian Associate Professor of Economics, Bu-Ali Sina University, Hamedan, Iran Saeed Isazadeh Associate Professor of Economics, Bu-Ali Sina University, Hamedan, Iran Ebrahim Faraji Ph.D. Student of Economics, Bu-Ali Sina University, Hamedan, Iran Journal Article 2016 05 14 New economies undergo significant short-run variations in aggregate output and employment. Understanding the causes of aggregate fluctuations is a central goal of macroeconomics. RBC models consider real shocks as the main cause of business cycles. Within RBC models, the purposes of this study are estimating the real shocks of Iran’s economy and investigating its effects on the economy’s fluctuations. For these purposes, a method that is introduced by McCallum (1989) has been applied during the years 1959-2014. According to the results presented in this study, the highest amount of persistency of the real shocks is related to the oil sector then to the agricultural sector. The variability of oil sector shocks is much more than the variability of agriculture sector shocks. A periodic manner with parallel and durable fluctuations can be seen in the shocks. Negative effects are more intense than positive effects. It seems, Iran’s economy undergoes five real business cycles in 56-year of the study. Also, the production fluctuations due to real shocks are a hump-shape process. These fluctuations peak after 1 or 2 years, then decline. New economies undergo significant short-run variations in aggregate output and employment. Understanding the causes of aggregate fluctuations is a central goal of macroeconomics. RBC models consider real shocks as the main cause of business cycles. Within RBC models, the purposes of this study are estimating the real shocks of Iran’s economy and investigating its effects on the economy’s fluctuations. For these purposes, a method that is introduced by McCallum (1989) has been applied during the years 1959-2014. According to the results presented in this study, the highest amount of persistency of the real shocks is related to the oil sector then to the agricultural sector. The variability of oil sector shocks is much more than the variability of agriculture sector shocks. A periodic manner with parallel and durable fluctuations can be seen in the shocks. Negative effects are more intense than positive effects. It seems, Iran’s economy undergoes five real business cycles in 56-year of the study. Also, the production fluctuations due to real shocks are a hump-shape process. These fluctuations peak after 1 or 2 years, then decline.

https://egdr.journals.pnu.ac.ir/article_3031_9e18c38b12edc3df6652768d7bbb24e5.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Measuring the External Efficiency of Formal Education and Its Impact on Economic Growth in Iran During 1975-2013 Measuring the External Efficiency of Formal Education and Its Impact on Economic Growth in Iran During 1975-2013 31 44 3105 FA Mandana Ghafoori Sadatieh Ph.D. Student of Development Economics, Ferdowsi University, Mashhad, Iran Mahdi Khoda Parast Mashhadi Associate Professor of Economics, Ferdowsi University, Mashhad, Iran Mostafa Salimifar Professor of Economics, Ferdowsi University, Mashhad, Iran Mostafa Kazemi Professor of Human Resourse Management, Ferdowsi University, Mashhad, Iran Journal Article 2016 06 06 This study aims to measure the external efficiency of formal education and then evaluating the effects of economic growth in Iran during 1957 to 2013. External efficiency, is the responsibility of educational system to social system in term of individual, economic, political and cultural dimensions. The research method to measure the relative efficiency is the Data Envelopment Analysis (DEA) method with the input-oriented and constant returns to scale, and efficient units are ranked using Anderson-Peterson (AP). Using the econometric method of GMM to evaluate the effect of the external efficiency of education on the economic growth. Results showed that in 85 percentages of examined years, external efficiency of education is acheived. Inputs that affect respectively on the external efficiency are educational equity, technology infrastructure, education expenditures and quality. Outputs that affect respectively on the external efficiency are freedom, environment protection, family sustainability and establishment. For inefficient units, the most of output shortage related to security and maximum output surplus is for education expenditures. External efficiency of education, labor and capital have a positive effect on economic growth in Iran and external efficiency of education is the cause of economic growth. This study aims to measure the external efficiency of formal education and then evaluating the effects of economic growth in Iran during 1957 to 2013. External efficiency, is the responsibility of educational system to social system in term of individual, economic, political and cultural dimensions. The research method to measure the relative efficiency is the Data Envelopment Analysis (DEA) method with the input-oriented and constant returns to scale, and efficient units are ranked using Anderson-Peterson (AP). Using the econometric method of GMM to evaluate the effect of the external efficiency of education on the economic growth. Results showed that in 85 percentages of examined years, external efficiency of education is acheived. Inputs that affect respectively on the external efficiency are educational equity, technology infrastructure, education expenditures and quality. Outputs that affect respectively on the external efficiency are freedom, environment protection, family sustainability and establishment. For inefficient units, the most of output shortage related to security and maximum output surplus is for education expenditures. External efficiency of education, labor and capital have a positive effect on economic growth in Iran and external efficiency of education is the cause of economic growth.

https://egdr.journals.pnu.ac.ir/article_3105_b82ea4c9fec1ecdec71a8497d04083f6.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Examination of Affecting Factors on Iran’s Human Development Index Using Bayesian Model Averaging Approach Examination of Affecting Factors on Iran’s Human Development Index Using Bayesian Model Averaging Approach 45 60 3039 FA Mohammad Saeed Noori Naeini Faculty Member of Shahid Beheshti University, Tehran, Iran Hesameddin Ghasemi Ph.D. Student of Economics, Shahid Beheshti University, Tehran, Iran Maryam Sadat Kazemi Torbaghan M.A. of Entrepreneurship Management, Tehran University, Tehran, Iran Journal Article 2016 07 15 Nowadays, human development plays a key role in development studies. The man is the main pillar of sustainable development. Human development Index has been the most popular indicator of development. Knowing the variables involved in the estimation of human development index is essential in choosing the appropriate model that can accurately measure the human development index. In this paper, we consider the uncertainty modeling framework for study of the factors that affect the human development index. For this purpose, we use the Bayesian model averaging which is appropriate with the assumption of model uncertainty. In this study, by estimating 960000 regression equations, five variables are identified as non-fragile variables which is mentioned as follows: growth of oil revenues, growth of government health expenditure, growth of primary education, inflation and capital stock. Other variables lost their effect in the presence of non--fragile variables. Therefore, it can be concluded that in order to raise the index of human development in the country, it is necessary to pay more attention to the mentioned variables. Nowadays, human development plays a key role in development studies. The man is the main pillar of sustainable development. Human development Index has been the most popular indicator of development. Knowing the variables involved in the estimation of human development index is essential in choosing the appropriate model that can accurately measure the human development index. In this paper, we consider the uncertainty modeling framework for study of the factors that affect the human development index. For this purpose, we use the Bayesian model averaging which is appropriate with the assumption of model uncertainty. In this study, by estimating 960000 regression equations, five variables are identified as non-fragile variables which is mentioned as follows: growth of oil revenues, growth of government health expenditure, growth of primary education, inflation and capital stock. Other variables lost their effect in the presence of non--fragile variables. Therefore, it can be concluded that in order to raise the index of human development in the country, it is necessary to pay more attention to the mentioned variables.

https://egdr.journals.pnu.ac.ir/article_3039_1f0f842a8bdeb9b40158f0d65ac19aae.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Non-Linear Effects of Economic Globalization on Income Inequality in Iran: Smooth Transition Regression (STR) Model Non-Linear Effects of Economic Globalization on Income Inequality in Iran: Smooth Transition Regression (STR) Model 61 76 3064 FA Mohammad Jafari Assistant Professor of Economics, Lorestan University, Lorestan, Iran Journal Article 2016 07 08 Due to the important role of economic globalization in income inequality of countries, the purpose of this paper is to investigate the non-linear impact of economic globalization on income inequality in Iran during 1979-2014. For this purpose, is used the smooth transition regression (STR) model. The estimated Smooth Transition Regression (STR) model supports a nonlinear threshold behavior in the relationship between economic globalization and income inequality in the country in a two regime structures with positive effect and a threshold level of about 26/15%. so that increases the intensity of this positive impact with crossing threshold level and entering the second regime. Due to the important role of economic globalization in income inequality of countries, the purpose of this paper is to investigate the non-linear impact of economic globalization on income inequality in Iran during 1979-2014. For this purpose, is used the smooth transition regression (STR) model. The estimated Smooth Transition Regression (STR) model supports a nonlinear threshold behavior in the relationship between economic globalization and income inequality in the country in a two regime structures with positive effect and a threshold level of about 26/15%. so that increases the intensity of this positive impact with crossing threshold level and entering the second regime.

https://egdr.journals.pnu.ac.ir/article_3064_b2066091600e7bcb0388c44eae860cbf.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Assessing the Importance of Health Sector Using The Partial Extraction Method, the Case Study of Iranian Economy Assessing the Importance of Health Sector Using The Partial Extraction Method, the Case Study of Iranian Economy 77 96 3391 FA Solaleh Tavassoli Ph.D. Student in Economics, Allameh Tabatabai University, Tehran, Iran Parisa Mohajeri Assistant Professor of Ecinomics, Allameh Tabatabai University, Tehran, Iran Journal Article 2016 12 05 There is no doubt that improving the level of social welfare, meeting the basic needs and achieving to high economic growth rate are the important aims of policy makers. On one hand, coinciding with the year in which codification and approval of 6th development program is on the agenda of parliament and government and on the other hand, lack of financial resources may lead to policy makers have encountered with the issue of identifying key sectors and evaluating importance of economic sectors. In this paper, for the first time we have studied the consequences of 10 percent shutdown in the health sector supply on output and value added of other sectors. For answering this question, we have applied partial extraction method which proposed by Dietzenbacher and Lahr (2013). In addition, we have investigated the dependency of health sector on other economic sectors by means of 10 percent partial extraction of sector’s supplies. Updated domestic Input-Output Tables in 2011 which aggregated in 19 sectors is the basis of calculation. The results show that first; the economy’s total value added was decreased 0,43 percent due to partial extraction (10 percent) of health sector. Second, public and private health sectors in comparison with other subsectors of health are more important because, the total value added of the economy was diminished 0,03 and 0,02 percent because of the reduction in their deliveries. Third, following partial extraction of health sector and its subsectors, the largest decreases in value added take place in the medical instruments, water, electrics and gas, other services and business services while public affairs and education and oil and gas, had the least changes in the value added that reflected low dependency of mentioned sectors on health sector. Fourth, the health sector is most dependent on the manufacturing sector and its value added decreased 0,3 percent by partial extraction on manufacturing sector. There is no doubt that improving the level of social welfare, meeting the basic needs and achieving to high economic growth rate are the important aims of policy makers. On one hand, coinciding with the year in which codification and approval of 6th development program is on the agenda of parliament and government and on the other hand, lack of financial resources may lead to policy makers have encountered with the issue of identifying key sectors and evaluating importance of economic sectors. In this paper, for the first time we have studied the consequences of 10 percent shutdown in the health sector supply on output and value added of other sectors. For answering this question, we have applied partial extraction method which proposed by Dietzenbacher and Lahr (2013). In addition, we have investigated the dependency of health sector on other economic sectors by means of 10 percent partial extraction of sector’s supplies. Updated domestic Input-Output Tables in 2011 which aggregated in 19 sectors is the basis of calculation. The results show that first; the economy’s total value added was decreased 0,43 percent due to partial extraction (10 percent) of health sector. Second, public and private health sectors in comparison with other subsectors of health are more important because, the total value added of the economy was diminished 0,03 and 0,02 percent because of the reduction in their deliveries. Third, following partial extraction of health sector and its subsectors, the largest decreases in value added take place in the medical instruments, water, electrics and gas, other services and business services while public affairs and education and oil and gas, had the least changes in the value added that reflected low dependency of mentioned sectors on health sector. Fourth, the health sector is most dependent on the manufacturing sector and its value added decreased 0,3 percent by partial extraction on manufacturing sector.

https://egdr.journals.pnu.ac.ir/article_3391_0058ec51b11bb28425db16b42f6bccb6.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Modeling Healthcare Expenditure among Iranian Households Modeling Healthcare Expenditure among Iranian Households 97 110 3788 FA Soheila Savojipour Ph.D. Student in Health Ecinomics, Tarbiat Modares University, Tehran, Iran Abbas Assari Arani Faculty Member of Management and Economics, Tarbiat Modares University, Tehran, Iran Lotfali Agheli Assistant Professor of Ecinomics, Tarbiat Modares University, Tehran, Iran Ali Hasanzadeh Ophthalmologist and Senior Health System Researcher, IHIO Journal Article 2016 12 20 This study models healthcare expenditure in household level with the aim of utilizing enough health goods and services in Iran. For this purpose, first suitable econometrics methods for health sector are investigated and then main determinants of households’ healthcare expenditure are introduced by using the sample selection model. Model estimation has been based on the socio-economic and demographic information of 38513 Iranian households, derived from household’s income- expenditure survey (HIES) in 2011. The results show that the increasing of household's members (children, youth and elderly) and women proportion, to be married of household's head, smoking, having health insurance and living in urban and more development areas encourage households to purchase health goods and services in respective market. On the other hand, household's healthcare expenditure will increase if household consumes more amount of Tobacco, family number, especially the number of elderly members is more and the larger proportion of family members belongs to women. Moreover, households that belong to middle income groups, and who have health insurance and their header is married spend higher expenditure to purchase the health goods and services. This result is true about households which have house; their members are more educated and live in urban areas and provinces where more developed in terms of health facilities. This study models healthcare expenditure in household level with the aim of utilizing enough health goods and services in Iran. For this purpose, first suitable econometrics methods for health sector are investigated and then main determinants of households’ healthcare expenditure are introduced by using the sample selection model. Model estimation has been based on the socio-economic and demographic information of 38513 Iranian households, derived from household’s income- expenditure survey (HIES) in 2011. The results show that the increasing of household's members (children, youth and elderly) and women proportion, to be married of household's head, smoking, having health insurance and living in urban and more development areas encourage households to purchase health goods and services in respective market. On the other hand, household's healthcare expenditure will increase if household consumes more amount of Tobacco, family number, especially the number of elderly members is more and the larger proportion of family members belongs to women. Moreover, households that belong to middle income groups, and who have health insurance and their header is married spend higher expenditure to purchase the health goods and services. This result is true about households which have house; their members are more educated and live in urban areas and provinces where more developed in terms of health facilities.

https://egdr.journals.pnu.ac.ir/article_3788_3af9a23f0fc2e0f04d88fee647a4649b.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 The Evaluation of Relative Efficiency of All Provinces in Terms of Human Development Using NDEA Method The Evaluation of Relative Efficiency of All Provinces in Terms of Human Development Using NDEA Method 111 126 3116 FA Abbas Rezaei Pandari Ph.D. of Industrial Management, Tarbiat Modarres University, Tehran, Iran Elham Mahmudinejad M.A. of Industrial Management, Tarbiat Modarres University, Tehran Parisa Bakhshi Expert in Statistical Center of Iran, Tehran, Iran Journal Article 2016 09 26 By considering that the resources and accessible facilities are limited, achieving development, particularly high human development is important target in adjusting development plans; therefore in developing countries policy makers and planners are worried about recognition and analysis of accelerating factors in development process as well as diagnosis the barriers, which using of indexes and modern instruments to attain is necessary and evident. Human development is one of noticeable contexts for policy makers, planners and researchers which is measured by human development index (HDI). Criticisms of HDI and creation of nonparametric methods of performance evaluation have caused evaluation of human development by applying data envelopment analysis (DEA). The lack of recognition of sources of inefficiency is one of the weakness points in traditional approach in DEA, hence in this paper separation efficiency approach is used, which is based on according to process and network data envelopment analysis (NDEA). In this article by considering a two stage process for human development, which is inclusive making infrastructures and getting results, relative efficiency for human development is measured in all provinces in a five year period from 2010 to 2014. The results of research highlighted that Tehran and Alborz provinces had high efficiency in human development and on the other side in terms of human development compared to the remained provinces, Kurdistan, Mazandaran and Lorestan are ranked that at the end of table. Total efficiency separation illustrated that inefficiency in preparing human development infrastructures had more effect in total efficiency. By considering that the resources and accessible facilities are limited, achieving development, particularly high human development is important target in adjusting development plans; therefore in developing countries policy makers and planners are worried about recognition and analysis of accelerating factors in development process as well as diagnosis the barriers, which using of indexes and modern instruments to attain is necessary and evident. Human development is one of noticeable contexts for policy makers, planners and researchers which is measured by human development index (HDI). Criticisms of HDI and creation of nonparametric methods of performance evaluation have caused evaluation of human development by applying data envelopment analysis (DEA). The lack of recognition of sources of inefficiency is one of the weakness points in traditional approach in DEA, hence in this paper separation efficiency approach is used, which is based on according to process and network data envelopment analysis (NDEA). In this article by considering a two stage process for human development, which is inclusive making infrastructures and getting results, relative efficiency for human development is measured in all provinces in a five year period from 2010 to 2014. The results of research highlighted that Tehran and Alborz provinces had high efficiency in human development and on the other side in terms of human development compared to the remained provinces, Kurdistan, Mazandaran and Lorestan are ranked that at the end of table. Total efficiency separation illustrated that inefficiency in preparing human development infrastructures had more effect in total efficiency.

https://egdr.journals.pnu.ac.ir/article_3116_26166876cf4d250f62b44c1323059878.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 Horizontal and Vertical Diversification Policies of Export and their Effect on Economic Growth: Markov Switching Approach Horizontal and Vertical Diversification Policies of Export and their Effect on Economic Growth: Markov Switching Approach 127 144 3293 FA Hossein Amiri Assistant Professor, Faculty of Economics, Kharazmi University, Tehran , Iran Marjaneh Beshkhoor Young Researchers and Elite Club, Mashhad Branch, Islamic Azad university, Mashhad, Iran Journal Article 2016 10 08 In this study, the effect of horizontal and vertical diversification policies on economic growth in Iran is investigated. The approach applied is Markov Switching regimes, for annual data series 1979-2015. The growth rates of horizontal and vertical diversification, consume expenditure, and investment as well as inflation rate are the variables which are used in this study. The results show that inflation rate, consume expenditure and vertical diversification growth have positive and significant effect, in both 0 and1 regimes, on economic growth. Furthermore, the horizontal diversification and investment growth also have positive effect on economic growth but only in 0 regime. Additionally, the predicted economic growth rate under three proposed scenarios, for 2016 and 2017 years, show that we can reach 8 percentage as medium growth rate in the sixth development program with emphasizing on vacant capacity, especially horizontal and vertical diversification policies. In this study, the effect of horizontal and vertical diversification policies on economic growth in Iran is investigated. The approach applied is Markov Switching regimes, for annual data series 1979-2015. The growth rates of horizontal and vertical diversification, consume expenditure, and investment as well as inflation rate are the variables which are used in this study. The results show that inflation rate, consume expenditure and vertical diversification growth have positive and significant effect, in both 0 and1 regimes, on economic growth. Furthermore, the horizontal diversification and investment growth also have positive effect on economic growth but only in 0 regime. Additionally, the predicted economic growth rate under three proposed scenarios, for 2016 and 2017 years, show that we can reach 8 percentage as medium growth rate in the sixth development program with emphasizing on vacant capacity, especially horizontal and vertical diversification policies.

https://egdr.journals.pnu.ac.ir/article_3293_ea6b8fbf47ee5d79ff296fe3b68b182e.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 The Intellectual Capital, Productivity Changes and Efficiency: Evidence of Iran’s Insurance Industry The Intellectual Capital, Productivity Changes and Efficiency: Evidence of Iran’s Insurance Industry 156 145 3191 FA Mehdi Fathabadi Assistant Professor of Economics, Firoozkooh Branch, Islamic Azad University, Firoozkooh, Iran Journal Article 2016 09 23 This study examines the impact of intellectual capital on changes in productivity and efficiency in Iran’s insurance firms for period 2008-2013. First, it estimated the Malmquist productivity index (MPI) and efficiency index with data envelopment analysis (DEA) approach. Second, this paper examines the impact of intellectual capital components (human capital, structural capital, financial capital) on changes in productivity and efficiency through panel data regressions. Our MPI findings indicate that most of insurance firms experienced decrease in productivity over the sample period; which it is due to decline in efficiency. The fixed effects estimation results reveal that intellectual capital and its individual components have significantly positive impacts on changes in productivity and efficiency of insurance firms. We suggest that general insurers in Iran should invest in intellectual capital, including improving their managerial skills, to gain sustainable growth in productivity. The findings of this study may lead to a better understanding of the relative changes in total productivity of general insurance firms. By identifying changes in efficiency and productivity, better management decisions can be made to achieve greater productivity. This study examines the impact of intellectual capital on changes in productivity and efficiency in Iran’s insurance firms for period 2008-2013. First, it estimated the Malmquist productivity index (MPI) and efficiency index with data envelopment analysis (DEA) approach. Second, this paper examines the impact of intellectual capital components (human capital, structural capital, financial capital) on changes in productivity and efficiency through panel data regressions. Our MPI findings indicate that most of insurance firms experienced decrease in productivity over the sample period; which it is due to decline in efficiency. The fixed effects estimation results reveal that intellectual capital and its individual components have significantly positive impacts on changes in productivity and efficiency of insurance firms. We suggest that general insurers in Iran should invest in intellectual capital, including improving their managerial skills, to gain sustainable growth in productivity. The findings of this study may lead to a better understanding of the relative changes in total productivity of general insurance firms. By identifying changes in efficiency and productivity, better management decisions can be made to achieve greater productivity.

https://egdr.journals.pnu.ac.ir/article_3191_351aa0be7b48eb69b33276a3cbdfbdf5.pdf

Payame Noor University Economic Growth and Development Research 2228-5954 8 29 2017 12 22 The Effect of Political Risk on Foreign Direct Investment in Iran The Effect of Political Risk on Foreign Direct Investment in Iran 157 174 3109 FA Omolbanin Jalali Ph.D Candidate in Economics, Department of Economics, Yazd University, Yazd, Iran Habib Ansari Samani Assistant Professor of Economics, Department of Economics, Yazd University, Yazd, Iran Madjid Hatefi Madjumerd Ph.D in Economics, Department of Economics, University of Sistan and Baluchestan, Sistan and Baluchestan, Iran Journal Article 2016 08 02 The aim of this study at first is to study the effective factors of FDI and then the estimation of these effects during 1983-2014. In this regard the causality relationship between FDI and political risk, GDP, trade openness index, inflation and exchange rate, has been investigated through Hsiao and Toda-Yamamoto tests. Then using a smooth transition regression model, the effect of determinants of foreign direct investment will estimated. In addition, results show that political risk, GDP and exchange rate are statistical cause of FDI, but trade openness index and inflation have no significant effect on foreign direct investment. In addition, the nonlinearity of model was also verified. The model showed that the FDI function can be investigated in the form of a structure with a two regime with threshold value of $ 2,000 million. Political risk in both regimes has a negative effect on foreign direct investment, but with the arrival to high regime, the sensitivity will be reduced. This relationship between the GDP and FDI is opposite. The aim of this study at first is to study the effective factors of FDI and then the estimation of these effects during 1983-2014. In this regard the causality relationship between FDI and political risk, GDP, trade openness index, inflation and exchange rate, has been investigated through Hsiao and Toda-Yamamoto tests. Then using a smooth transition regression model, the effect of determinants of foreign direct investment will estimated. In addition, results show that political risk, GDP and exchange rate are statistical cause of FDI, but trade openness index and inflation have no significant effect on foreign direct investment. In addition, the nonlinearity of model was also verified. The model showed that the FDI function can be investigated in the form of a structure with a two regime with threshold value of $ 2,000 million. Political risk in both regimes has a negative effect on foreign direct investment, but with the arrival to high regime, the sensitivity will be reduced. This relationship between the GDP and FDI is opposite.

https://egdr.journals.pnu.ac.ir/article_3109_7714d6e3679070ac0025e331a42774d4.pdf