Measuring the productivity of capital in the industrial sector of Sistan and Baloochestan State, Iran

This working paper strives to measure analyze and the productivity of capital in the industrial sector in the case of the State of Sistan and Baloochestan over the period 1982-2009. Three production functions (Debertin, Cobb-Douglas and Transcendental logarithm (Translog)) are estimated by relevant variables such as labor, capital and GDP. Akaike, Schwarz information criteria and LR test indicate that the Cobb-Douglas model should be preferred. In order to avoid a spurious regressing Johansen test detects a cointegration. According to this detection the cointegration term (-0.46) indicates that the deviation from long-run equilibrium is rectified gradually through a series of partial short term adjustments after or so two years.The results of this function reveal that there's been a diminishing trend in productivity of capital since 1982.So it demonstrates the lack of attention to capital productivity. Thus we can conclude that Sistan suffers from the absence of comprehensive strategy and segregation between trade and production policies

The Impact of Effective Governance and Regulatory Quality on Financial Development Under Economic Conditions of the Mena Countries

The present study uses the Systematic Generalized Method of Moment's (SGMM) model to investigate the effects of effective governance and regulatory quality on financial development in the economic conditions of the Mena countries during the period 2002-2009. The results of the study show a positive relationship between the role or rule of law (RL) and economic growth (GDP) with financial development (FD). The variables of regulatory quality (RO), government budget deficit (BD), government effectiveness (GE) and financial crisis (FC) are negative. The negative sign of regulatory quality, government effectiveness and budget deficit for the MENA countries can be justified as follows; The more accountable and efficient the government in a country, the greater the political stability, the lower the additional regulations and costs, the more extensive the rule of law, the smaller the government effectiveness, and the more restricted the corruption, the greater the financial development requiring the more attention of government and authorities in accountability, compliance of rules and regulatory quality. Also the positive variable of the dependent variable lag; the financial development Index shows the countries' attention to the financial development issue and the use of strategies and infrastructure to increase financial development based on financial liberalization indicators over time, which requires much attention from government authorities

Investigating the Effects of Privatization on the Economic Growth in Developing Countries: A Fixed Effects Approach

Considering that the economic adjustment policies have been proposed by international institutions for achieving a sustainable economic growth in the developing countries, the latter adopted privatization trend in economy following the application of economic adjustment policies. In this study, we investigated the effects of privatization on the economic growth of developing countries in 2000-2008. We selected a suitable model based on the past experimental studies, use of qualitative and institutional variables in economy as well as use of controlling variables for different regions. Results of estimation in different areas show that privatization in the MENA region, Latin America and Caribbean region, and sub-Saharan Africa had not significant effects on economic growth (Similar results of previous research) but for west Asia and Pacific areas, Central Asia and Western Europe, and South Asia had significant positive effects on economic growth. Keywords: Privatization, Economic Growth, Developing Countries, Fixed effect

Structure of the bank’s balance sheet at the end of the period.

Structure of the bank’s balance sheet at the end of the period.</p

Optimization of Asset and Liability Management of Banks with Minimum Possible Changes

Asset-Liability Management (ALM) of banks is defined as simultaneous planning of all bank assets and liabilities under different conditions and its purpose is to maximize profits and minimize the risks in banks by optimizing the parameters in the balance sheet. Most of the studies `and proposed models in the ALM field are based on an objective function that maximizes bank profit. It is not easy to apply changes in these models in order to reach the optimal values of the parameters in the balance sheet. In this article, an attempt has been made to propose a linear model using constraints to achieve optimal values of balance sheet parameters using ALM objectives and considering balance sheet, system and regulatory constraints. It has also been tried to design the model according to the most possible mode and with the least changes and to minimize the size of the balance sheet. The analysis of the model presented in this article has been conducted using the parameters of the balance sheet and income statement of one of the famous Iranian banks. The results obtained from the proposed model show that the values of cash and receivables from banks and other credit institutions have decreased by 30% and increased by 200%, respectively, compared to the actual values of these parameters. Also, Total Income, Operating Income and Non-Operating Income have grown by 30% compared to the actual values of these parameters. Also, the values of a number of parameters are estimated to be zero after optimization. According to the results, it is obvious that the performance of bank managers, especially in the management of bank assets, is significantly different from the optimal values of the balance sheet, and the results obtained from the proposed model can help the management of banks as much as possible

Effects of negative technology shock on economic variables.

Effects of negative technology shock on economic variables.</p

Effects of risk shock on economic variables.

Investigating the credit channel and monetary policy risk channel in Iran’s economy is the aim of this article. According to empirical studies, expansionary monetary policy increases the risk of banks, and on the other hand, the risk of banks affects economic activities and price levels. In order to investigate the mechanism of the credit channel and the risk channel (as a new channel), the effect of monetary policy on real variables and price levels in Iran’s economy, the Dynamic Stochastic General Equilibrium (DSGE) model has been used by entering the information of the banking system and considering moral hazard and adverse choices. The obtained results show that there is a credit channel and a monetary policy risk channel for Iran’s economy, and the expansionary monetary policy shock causes output, inflation, private sector consumption, investment, net worth in the economy and lending to increase. Also, when a credit shock occurs, with the increase in banks’ lending power, production, private sector consumption, investment, net worth and total lending increase and the inflation level decreases. Also, by applying the risk shock caused by the increase in inflation and the decrease in consumption and investment, the volume of lending increases and the level of production does not change much.</div

Summary of data used in the presented model.

Investigating the credit channel and monetary policy risk channel in Iran’s economy is the aim of this article. According to empirical studies, expansionary monetary policy increases the risk of banks, and on the other hand, the risk of banks affects economic activities and price levels. In order to investigate the mechanism of the credit channel and the risk channel (as a new channel), the effect of monetary policy on real variables and price levels in Iran’s economy, the Dynamic Stochastic General Equilibrium (DSGE) model has been used by entering the information of the banking system and considering moral hazard and adverse choices. The obtained results show that there is a credit channel and a monetary policy risk channel for Iran’s economy, and the expansionary monetary policy shock causes output, inflation, private sector consumption, investment, net worth in the economy and lending to increase. Also, when a credit shock occurs, with the increase in banks’ lending power, production, private sector consumption, investment, net worth and total lending increase and the inflation level decreases. Also, by applying the risk shock caused by the increase in inflation and the decrease in consumption and investment, the volume of lending increases and the level of production does not change much.</div

Tests and post-testing of the results.

Investigating the credit channel and monetary policy risk channel in Iran’s economy is the aim of this article. According to empirical studies, expansionary monetary policy increases the risk of banks, and on the other hand, the risk of banks affects economic activities and price levels. In order to investigate the mechanism of the credit channel and the risk channel (as a new channel), the effect of monetary policy on real variables and price levels in Iran’s economy, the Dynamic Stochastic General Equilibrium (DSGE) model has been used by entering the information of the banking system and considering moral hazard and adverse choices. The obtained results show that there is a credit channel and a monetary policy risk channel for Iran’s economy, and the expansionary monetary policy shock causes output, inflation, private sector consumption, investment, net worth in the economy and lending to increase. Also, when a credit shock occurs, with the increase in banks’ lending power, production, private sector consumption, investment, net worth and total lending increase and the inflation level decreases. Also, by applying the risk shock caused by the increase in inflation and the decrease in consumption and investment, the volume of lending increases and the level of production does not change much.</div