https://egdr.journals.pnu.ac.ir/ Economic Growth and Development Research en daily 1 Tue, 23 Sep 2025 00:00:00 +0330 Tue, 23 Sep 2025 00:00:00 +0330 https://egdr.journals.pnu.ac.ir/article_12156.html The present study aims to model the dynamic relationship between institutional indicators, environmental pollution, economic development, and public health in MENA member countries. This applied research covers the period from 2010 to 2023. To model the dynamic relationships between the variables, the Time-Varying Parameter Panel Factor-Augmented Vector Autoregression (TVP-PFAVAR) approach has been employed.The results indicate the presence of a nonlinear dynamic behavior among the study variables. Accordingly, the TVP-PFAVAR model was used instead of traditional panel vector autoregressive models. Based on the findings, institutional indicators have a positive effect on economic development and public health while reducing environmental pollution. Additionally, economic development positively and increasingly influences institutional indicators, public health, and environmental pollution. The results further reveal that public health has a positive impact on institutional indicators and economic development, but a negative effect on environmental pollution. Moreover, environmental pollution negatively affects all three indicators.It is noteworthy that, in general, the long-term trends of the variables had a stronger impact on each other compared to their short-term trends, reflecting the Le Chatelier principle among MENA countries. According to this principle, variables have more opportunities to influence one another over the long run. https://egdr.journals.pnu.ac.ir/article_12264.html Green investment, as a key instrument for achieving economic growth, sustainable development, and combating climate change, faces unique challenges in resource-dependent economies. This study examines the impact of financial development on green investment, with a specific focus on the moderating role of natural resource abundance, using data from 133 resource-rich developing countries over the period 1990–2021. Nonlinear relationships and threshold effects were analyzed using the Panel Smooth Transition Regression (PSTR) model. The results reveal a two-regime structure in the relationship between financial development and green investment, with the estimated threshold for natural resource rents at approximately 3.22% of GDP. In the first regime (low resource rents), financial development, resource rents, institutional quality, human capital, GDP, and foreign direct investment all exhibit positive and significant effects on green investment. In contrast, in the second regime (high resource rents), the effects of financial development and resource rents weaken and even turn negative, consistent with the resource curse hypothesis. However, institutional quality, human capital, and foreign direct investment demonstrate stronger positive effects in this regime, indicating their capacity to mitigate some of the adverse consequences of resource abundance. The findings suggest that a successful transition to a low-carbon economy in resource-dependent countries requires combining financial development with institutional strengthening, economic diversification, human capital enhancement, and effective attraction of foreign direct investment. https://egdr.journals.pnu.ac.ir/article_12216.html The purpose of this study is to investigate the regionalization of subsidies at the level of rural areas of Iran. In this regard, poverty line and poverty indicators were calculated based on the income -expenditures data of rural households in 2022.Then,by using the hierarchical clustering method, the rural areas of the provinces were classified into eight clusters, and finally, using a numerical method that maximizes the reduction in the poverty indicators by group transfers , the results of national and regional targeting were compared. The results show that the characteristics of household size, head education and the number of members under six years of age are the most effective for targeting poverty. Despite this issue, the results revealed significant differences. This difference exists in the demographic share of the target groups, the amount of subsidies paid, the effectiveness of targeting and in poverty reduction. Therefore,even if the policy maker wants to target the same households at the national and regional level based on individual characteristics or a combination of them, it is still necessary to pay different amounts to the same population groups at the level of different regions. Also, it should not be assumed that using a targeting method alone will solve all the problems of identifying the poor, but for more efficiency, it is necessary to use a combination of targeting methods, in this context, the geographic/regional targeting method is generally used as the first step. https://egdr.journals.pnu.ac.ir/article_12240.html This study investigates the impact of technological factors on the exports of creative industries in the United States, the United Kingdom, Iran, Japan, Australia, and South Korea over the period 2004–2020. Using panel data for these leading countries and applying stationarity tests, a fixed-effects panel regression model was employed to analyze the relationships between patent applications, high-technology exports, research and development (R&D) expenditures, and creative industries exports. The findings reveal that patent applications exert the most significant and positive effect on creative industries exports. In addition, high-technology exports and R&D expenditures considerably enhance the exports of these industries. Diagnostic tests confirmed the validity of the results, and the model was statistically robust and explanatory. Considering Iran’s specific position among the countries studied, the potential capacities of technology and innovation in Iran—despite structural barriers and economic constraints—indicate opportunities for the growth of creative industries exports. This study highlights the importance of targeted investment and supportive policies for fostering innovation and advanced technologies in Iran and may serve as a guide for policymakers in designing sustainable and innovative export strategies https://egdr.journals.pnu.ac.ir/article_12154.html This study examines the heterogeneous effects of financial development, the energy trilemma index, and economic complexity on economic growth in N11 countries during 2000–2023. Using the Method of Moments Quantile Regression (MMQR), the analysis captures how these factors affect different points of the growth distribution. The Pesaran slope homogeneity test rejected coefficient homogeneity, validating the MMQR approach. To ensure robustness for average effects, additional estimations were conducted using Panel Corrected Standard Errors (PCSE), Driscoll-Kraay, and Feasible Generalized Least Squares (FGLS). Results from MMQR indicate substantial heterogeneity: financial development and urbanization positively and significantly affect growth across most quantiles, though the impact of urbanization slightly weakens at higher quantiles. Renewable energy consumption, the energy trilemma index, and economic complexity show stronger positive effects in the lower and middle quantiles, whereas foreign direct investment becomes more influential in higher quantiles. Robustness checks confirm the general positive and significant influence of all variables on growth. The findings highlight the importance of tailored policy approaches: countries with lower growth should prioritize improving the energy trilemma, enhancing economic complexity, and expanding renewable energy, while those with higher growth should focus on attracting foreign investment and strengthening financial systems. These insights underscore the need for differentiated growth strategies aligned with each country’s position in the growth distribution. https://egdr.journals.pnu.ac.ir/article_12153.html Following the 2008 global financial crisis, the relationship between economic policy uncertainty (EPU) and exchange rate dynamics has garnered significant attention. In Iran, this nexus is particularly complex due to structural shocks and extensive interventions. This study employs a Continuous Wavelet Transform (CWT) to analyze quarterly data from 1980:Q1 to 2024:Q2, dissecting the dynamic relationship across various time-frequency domains.The findings reveal that in the short run (less than 1 year), a strong, in-phase feedback loop exists between EPU and the exchange rate, where each variable reinforces the other. In the medium run (1–4 years), the relationship becomes more intricate; alongside the persistent in-phase causality, an inverse relationship from the exchange rate to EPU emerges, indicating adaptive economic responses. In the long run (more than 4 years), a stable and unidirectional inverse causality from the exchange rate to EPU is observed. This time-horizon decomposition is based on the standard wavelet analysis literature, distinguishing between business, cyclical, and long-term components.This finding confirms that artificially suppressing the exchange rate as a stabilization tool is counterproductive, as it merely shifts policy uncertainty to longer horizons, thereby contradicting its objective. https://egdr.journals.pnu.ac.ir/article_12178.html The main objective of this study is to examine the impact of digitalization, green investment, and financial development on Iran's economic sustainability using the wavelet quantile model to estimate short-term, medium-term, and long-term effects during the period 1379-1402. The results show that digitalization, especially in the industrial and financial services sectors, has a significant impact on increasing economic sustainability. Also, green investment and sustainable projects have a positive and significant impact on Iran's economic sustainability. In this regard, financial development directly affects the strengthening of the country's economic sustainability through better access to financial resources and strengthening economic infrastructure. In this study, using quantitative analyses and various models, the effects of these factors on economic sustainability in the short and long term are examined and their economic results are provided to policymakers and researchers. This study emphasizes the importance of paying attention to these factors in the country's economic policies and provides practical suggestions for improving Iran's economic sustainability. https://egdr.journals.pnu.ac.ir/article_11670.html Financial development plays an important role in economic development and growth. But the question is what effect does financial development have on the quality of the environment? The purpose of this study is to investigate the effect of different indicators of financial development on carbon dioxide emissions. Considering different financial development indicators, using principal component analysis (PCA), a composite index of financial development is constructed. The biggest role in the construction of the main component is the index of the percentage of bank deposits to GDP. The estimation of linear and non-linear ARDL model shows that renewable energy significantly leads to reduction of emissions and improvement of environmental quality, and Kuznets environmental curve is confirmed in Iran. Also, financial development has a long-run effect on carbon dioxide emissions. The Non-linear ARDL results indicate that the positive shock of financial development leads to a significant increase in carbon dioxide emissions, but the negative shock of financial development does not have a significant effect on carbon dioxide emissions. Therefore, financial development in Iran has not yet led to the achievement of environmentally friendly technologies, and considering the role and importance of financial development in economic growth and development, it is recommended to produce and consume renewable energy along with financial development in Iran to neutralize the effects of The negative environmental impact of financial development should be increased to achieve sustainable development. https://egdr.journals.pnu.ac.ir/article_11991.html In today's world, welfare is considered as a result of the development process, but this economic growth, along with the increase in pollutants, has made environmental crises a major challenge for governments. Therefore, creating a balance between economic development and environmental quality has become one of the main priorities of policymakers. This research, using the dynamic stochastic environmental general equilibrium model and employing money growth as a monetary policy variable ,government expenditure as a fiscal policy variable and carbon tax as a policy variable in the environmental field aims to examine and analyze the welfare effects of macroeconomic and environmental policies and presents a new rule for fiscal , monetary, and environmental policies analyzes the interactions between fiscal, monetary, and environmental policies in the Iranian economy. The research findings show that in conditions of economic prosperity and the presence of positive aggregate productivity shocks, fiscal policy is the only policy that can reduce emission levels and simultaneously improve household welfare.The results of this study can be useful for environmental policymakers and monetary and fiscal decision-makers in Iran. https://egdr.journals.pnu.ac.ir/article_12265.html Abstract:This study aims to examine the impact of insurers’ investments on gross fixed capital formation (GFCF) in Iran. In this research, data are quarterly (semi-annual, i.e., every six months) for the period 1389–1402 (2010–2023) and analyzed using an autoregressive distributed lag (ARDL) model with distributed lags. The results indicate a long-run relationship among the variables, showing that insurers’ investments in long-term bank deposits, long-term investments, and high-turnover market investments positively and significantly enhance GFCF, while inflation, the exchange rate, and the price of gold have negative effects; notably, a one-percent rise in inflation is associated with a substantial decrease in GFCF. The study also emphasizes that the coefficient of determination is about 99%, indicating a high explanatory power of the model. Based on these findings, it can be concluded that the insurance sector can strengthen the country’s economic growth through higher GFCF, and it is recommended to direct insurance investments toward higher-yield assets, develop life insurance, boost sector competitiveness, and have the government implement supportive policies to improve the investment environment. Additionally, controlling inflation and reducing macroeconomic risks are essential to enhance the positive impact of the insurance sector on the economy..Keywords: ARDL Modelو Gross Fixed Capital Formation, Insurance, Money and Capital Market. https://egdr.journals.pnu.ac.ir/article_12529.html In this paper, the effects of the decline in global oil prices on the macro - economic variables of Iran have been analyzed by designing a dynamic global economic balance model with respect to banking sector and credit risk of bul lion. based on the results of modeling for the iranian economy, the decrease in oil prices increases the exchange rate and reduces the demand for imported goods, which in the short term, through substitution effect, boosts domestic production and employment of unemployed people on a temporary basis. However, the drop in oil production and the monetary base constraint and the reduction in lending reduce total production in the subsequent period. on the other hand, inflation has increased temporarily, first because of increased demand for domestic production and then it has decreased because of the recession in the economy. the ability of firms to repay the received facilities is reduced and debt default is increased by reducing production followed by decreasing revenue. This would reduce the profitability of banks, which would limit the supply of credit more severely and weaken production and employment more severely. This cycle, combined with falling tax revenues, is pushing the economy into a sustained recession. Accordingly, dependence on oil and credit risk exacerbate the vulnerability of the economy. based on the results, it is suggested to increase economic resilience by adding to income sources, strengthening of waste sectors, and improving bank risk management. https://egdr.journals.pnu.ac.ir/article_12593.html This study applies a static, non-behavioral microsimulation model using Iran’s Household Income and Expenditure Survey (HIES) 1402 (2023/24) to evaluate the redistributive implications of moving from schedular (source-based) income taxation to a comprehensive personal income tax (PIT) under three scenarios. Scenario 1 represents separate taxation of distinct income sources, mirroring the fragmented regime. Scenario 2 aggregates taxable income sources under the PIT framework proposed in the Direct Taxes Law Reform Bill. Scenario 3 combines the PIT with a redistributive policy that allocates the incremental revenue from integration to targeted cash transfers for households below the relative poverty line. Relative to the pre-tax baseline (Gini = 0.3677), Scenario 1 reduces inequality by 2.7 percent, lowering the Gini to 0.3576. Scenario 2 delivers a larger but still modest effect, reducing the Gini by 4.9 percent to 0.3490. In contrast, Scenario 3 yields a sizeable redistributive impact: the Gini declines by 15.9 percent to 0.3090. The results indicate that the fragmented system exhibits limited progressivity—particularly at the top of the distribution—and that tax-base integration alone is unlikely to generate substantial redistribution. Meaningful inequality reduction requires complementary reforms, including a more progressive design of deductions and exemptions within the PIT, targeted allocation of incremental revenues to anti-poverty transfers, and strengthened data transparency and enforcement to expand coverage of informal and underreported incomes. https://egdr.journals.pnu.ac.ir/article_12612.html The central question of this study is whether greater use of the Earth’s resources can raise countries’ levels of happiness. To answer it, the paper examines the relationship between ecological footprint and happiness for two groups of countries—OECD and Middle Eastern—using a dynamic panel model estimated by standard and two-step generalized method of moments over 2014–2024. The dependent variable is the Happiness Index, and the regressors include per capita ecological footprint and its squared term, the Human Development Index, general government expenditure, and institutional quality. The first lag of happiness is positive and statistically significant in both groups, confirming strong persistence, which is more pronounced in Middle Eastern countries. For OECD members, the ecological footprint has a negative coefficient while its squared term is positive, yielding a standard U-shaped relationship: higher resource use at low and medium levels reduces happiness, but beyond a threshold of about two global hectares per capita, additional use raises happiness. For Middle Eastern countries, the ecological footprint enters with a positive coefficient and its squared term with a negative coefficient, implying an inverted U-shape with a turning point around 2.5 global hectares per capita; greater resource use increases happiness only up to this level, after which its effect becomes negative. Overall, the results indicate that exploiting the Earth’s resources can support sustainable happiness only when accompanied by human development, effective governance, and sound, forward-looking and environmentally responsible resource management over time. https://egdr.journals.pnu.ac.ir/article_12624.html This study investigates the relationship between renewable energy consumption and production, environmental pollutants, and social development in member countries of OECD and OPEC over the period 1990–2020. Using panel data and the Dumitrescu–Hurlin causality test, it examines the role of social development in facilitating the transition from fossil fuel-based energy consumption to cleaner energy sources. The Social Development Index (SDI) is constructed by aggregating fifteen indicators related to demographics, education, health, and access to technology, reflecting both societal capacity and welfare outcomes. The findings indicate that in OECD countries, a robust bidirectional causal relationship exists between SDI and renewable energy consumption (REC), meaning that improvements in social development promote higher renewable energy use, while the expansion of renewable energy, in turn, reinforces social development indicators. Furthermore, social development in these countries is significantly associated with better control of CO₂ emissions. In contrast, OPEC countries show no statistically significant causality between SDI and REC or SDI and CO₂ emissions. The only meaningful link is a unidirectional causality from CO₂ emissions to REC, suggesting that rising pollution levels provoke a reactive increase in renewable energy adoption rather than proactive social development-driven change. These contrasting patterns underscore the importance of social development levels, institutional maturity, and the integration of social and environmental dimensions in shaping energy transition processes. Overall, this research emphasizes that integrating social development and sustainable energy policies is crucial for successful energy transitions and effective reduction of environmental pollutants.