University of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Dynamic Efficiency in Regulation of Urban Water and Wastewater Companies of IranDynamic Efficiency in Regulation of Urban Water and Wastewater Companies of Iran1267622110.22059/jte.2020.286534.1008205FAFarzanehJaidary. Ph.D. Student of Economics, Department of Economics, Payam-e-Noor University, Tehran0009-0002-7301-0210FarhadKhodadad KashiProfessor, Department of Economics, Payam-e-Noor University, Tehran0009-0009-0449-9658AsgharAbolhasaniAssociate Professor, Department of Economics, Payam-e-Noor University, Tehran,, IranBagherDarvishiAssistant Professor, Department of Economics, Ilam University0000-0001-7893-8240Journal Article20190817The purpose of this study is to apply dynamic efficiency in regulation of urban water and wastewater companies in Iran. To this end, a dynamic stochastic frontier model that considers the heterogeneity in the long-term technical eficiency of the companies has been used to estimate the dynamic efficiency of 35 urban water and wastewater companies for the period of 2011-16 using the Bayesian approach. The research findings show that, in the absence of heterogeneity among companies, the inefficiency persistence is greater than the time when this heterogeneity is considered. JEL Classification: D24, D21, L95, L43, L51The purpose of this study is to apply dynamic efficiency in regulation of urban water and wastewater companies in Iran. To this end, a dynamic stochastic frontier model that considers the heterogeneity in the long-term technical eficiency of the companies has been used to estimate the dynamic efficiency of 35 urban water and wastewater companies for the period of 2011-16 using the Bayesian approach. The research findings show that, in the absence of heterogeneity among companies, the inefficiency persistence is greater than the time when this heterogeneity is considered. JEL Classification: D24, D21, L95, L43, L51https://jte.ut.ac.ir/article_76221_8a48e241f2c22a1f335c2149eef73868.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Estimates of Labor Mobility Costs in a Structural Model of Iran EconomyEstimates of Labor Mobility Costs in a Structural Model of Iran Economy27567624510.22059/jte.2020.280906.1008166FAMohammad HosseinRahmatiAssociate Professor Sharif University of Technology, Azadi Street, Tehran, Iran,0000-0002-6273-0661AliChobdaranMaster Student Sharif University of Technology, Tehran, Iran,Journal Article20190514In this study, we construct a structural model of labor market in Iran in order to estimate the labor mobility cost using micro data. The model benefits from heterogeneity in age, gender, household location, and education and estimate varying labor mobility costs conditional on these factors and the origin and destination of the mobility. We find that 1) inter-sectoral labor mobility in Iran is substantial and range between 3 to 11 times of average per capita income 2) the labor mobility costs is higher for women, educated laborer, old, and rural population 3) if the cost vanishes to zero, the production in tradable and non-tradable sector increase by 36 and 16 percent, respectively. These estimates provide significant evidence that implementing major policy changes can bring substantial welfare loss especially for laborers with lower education and in rural areas. JEL Classification: J61, J21, C15In this study, we construct a structural model of labor market in Iran in order to estimate the labor mobility cost using micro data. The model benefits from heterogeneity in age, gender, household location, and education and estimate varying labor mobility costs conditional on these factors and the origin and destination of the mobility. We find that 1) inter-sectoral labor mobility in Iran is substantial and range between 3 to 11 times of average per capita income 2) the labor mobility costs is higher for women, educated laborer, old, and rural population 3) if the cost vanishes to zero, the production in tradable and non-tradable sector increase by 36 and 16 percent, respectively. These estimates provide significant evidence that implementing major policy changes can bring substantial welfare loss especially for laborers with lower education and in rural areas. JEL Classification: J61, J21, C15https://jte.ut.ac.ir/article_76245_fb0b846795cf733c96f2f97afd3bb594.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Sensitivity Analysis and Ranking of Factors Affecting Iranian Financial Stability in the Framework of Composite Index ConstructionSensitivity Analysis and Ranking of Factors Affecting Iranian Financial Stability in the Framework of Composite Index Construction57857615210.22059/jte.2020.279561.1008156FAMojtabaSeyed HosseinzadehPh.D. Student of Economics at Semnan University,AlirezaErfaniAssociate Professor of the Faculty of Economics, Management and Administrative Sciences of Semnan University,MahdiGhaemi AslAssistant Professor, Faculty of Economics, Kharazmi University, Tehran, Iran0000-0002-2246-2914Journal Article20190426The financial system is stable when it has a positive effect on the performance of the economy and does not hinder it. Accordingly, a financial system must be able to withstand shocks and keep the allocation of savings, data transfer, payment system, etc. efficient and effective. In this study, first using global experience and data from Iran from 1990 to 2016, an aggregate index of financial stability under the four dimensions of "debtor institutions", "macroeconomics", "foreign sector" and "institutional quality" for Iran was built. After constructing the aggregate index, the most effective indicators on the "fluctuations" and "average value" of the aggregate financial stability index have been identified using the sensitivity analysis method. The results show that of the 48 available indicators, the "ratio of government budget deficit to GDP", which is one of the main indicators of "government financial health" in the "institutional quality" dimension, has the most negative effect on "fluctuations" and "average value" of the aggregate index of financial stability. Therefore in order to improve financial stability in Iran, the greatest focus should be on controlling the "ratio of government budget deficit to GDP." JEL Classification: C43, B15The financial system is stable when it has a positive effect on the performance of the economy and does not hinder it. Accordingly, a financial system must be able to withstand shocks and keep the allocation of savings, data transfer, payment system, etc. efficient and effective. In this study, first using global experience and data from Iran from 1990 to 2016, an aggregate index of financial stability under the four dimensions of "debtor institutions", "macroeconomics", "foreign sector" and "institutional quality" for Iran was built. After constructing the aggregate index, the most effective indicators on the "fluctuations" and "average value" of the aggregate financial stability index have been identified using the sensitivity analysis method. The results show that of the 48 available indicators, the "ratio of government budget deficit to GDP", which is one of the main indicators of "government financial health" in the "institutional quality" dimension, has the most negative effect on "fluctuations" and "average value" of the aggregate index of financial stability. Therefore in order to improve financial stability in Iran, the greatest focus should be on controlling the "ratio of government budget deficit to GDP." JEL Classification: C43, B15https://jte.ut.ac.ir/article_76152_5e4b14c29bdfdbaa1c7c3f29bf111d48.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Females’ Labor Market Development in Iran’s Provinces and its Impact on DivorceFemales’ Labor Market Development in Iran’s Provinces and its Impact on Divorce871137615310.22059/jte.2020.276666.1008116FAMohammad AliFeizpourDepartment of Economics, Faculty of Economics, Management and Accounting, Yazd University, Yazd, IranMarziehShakeri Hossein AbadDepartment of Economics, Faculty of Economics, Management and Accounting, Yazd University, Yazd, Iran0009-0008-9012-220XJournal Article20190223In the twelfth paragraph of Overall employment policies, issued by the supreme leader of Iran, the "reduction of the provincial unemployment in the provinces which have the rates above the national average" has been argued as a general policy. This subject can be interpreted in terms of gender point of view into two parts, the proximity of females and males unemployment rates in the provinces to the average unemployment rate of the country. While the theoretical foundations and available studies have indicated a significant relationship between provincial labor market development and social harms but, the results of these studies are different. Therefore, this research attempts to explore the interaction between the labor market and social harms in terms of gender in the provinces of Iran. The labor market development in this study is estimated with female employment indicators and integrated by using TOPSIS method. Also social harms of the provinces are measured by using the divorce rates. Using panel data method, the results of this research suggest that there is a significant and negative relationship between the females’ labor market development and divorce rates. In other words, the divorce rates have reduced by the females’ labor market development. From the policy point of view, this finding recommends the possibility of modifying the social harm by an economic decision. JEL Classification: R23, O11, J16, J12In the twelfth paragraph of Overall employment policies, issued by the supreme leader of Iran, the "reduction of the provincial unemployment in the provinces which have the rates above the national average" has been argued as a general policy. This subject can be interpreted in terms of gender point of view into two parts, the proximity of females and males unemployment rates in the provinces to the average unemployment rate of the country. While the theoretical foundations and available studies have indicated a significant relationship between provincial labor market development and social harms but, the results of these studies are different. Therefore, this research attempts to explore the interaction between the labor market and social harms in terms of gender in the provinces of Iran. The labor market development in this study is estimated with female employment indicators and integrated by using TOPSIS method. Also social harms of the provinces are measured by using the divorce rates. Using panel data method, the results of this research suggest that there is a significant and negative relationship between the females’ labor market development and divorce rates. In other words, the divorce rates have reduced by the females’ labor market development. From the policy point of view, this finding recommends the possibility of modifying the social harm by an economic decision. JEL Classification: R23, O11, J16, J12https://jte.ut.ac.ir/article_76153_094e35279360cfacbb32c090d46eddbb.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Determining the Resiliency Components of Iran's Trade SystemDetermining the Resiliency Components of Iran's Trade System1151337615410.22059/jte.2020.283979.1008186FAHesameddinGhasemiPh.D. Student of economics, Shahid beheshti University, Tehran, IranAbbasArabmazarnullAssociate Professor,Faculty of Economics, Shahid beheshti University, Tehran, IranJournal Article20190627an's trade system. Trade system vulnerabilities are considered as an important factor in reducing resilience. So, according to the existing resilience literature, and using the Grounded Theory approach, and the Bayesian Model Averaging approach, indicator factors were extracted. Four variables were identified in the presence of 23 variables; which include Risk index, oil export ratio to non-oil exports, free and official exchange rate differences, and Consuming imports to aggregate import ratio, as important variables. It shows that these variables should be considered more than other variables in assessing the effect of trade system. JEL Classification: E60, F41, F13, C13an's trade system. Trade system vulnerabilities are considered as an important factor in reducing resilience. So, according to the existing resilience literature, and using the Grounded Theory approach, and the Bayesian Model Averaging approach, indicator factors were extracted. Four variables were identified in the presence of 23 variables; which include Risk index, oil export ratio to non-oil exports, free and official exchange rate differences, and Consuming imports to aggregate import ratio, as important variables. It shows that these variables should be considered more than other variables in assessing the effect of trade system. JEL Classification: E60, F41, F13, C13https://jte.ut.ac.ir/article_76154_8714985490a4eaa4d5dc523c9e2504f1.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Simulation of the Housing Rental Market Using Agent-Based Modeling
Case Study: District 6 of Isfahan CitySimulation of the Housing Rental Market Using Agent-Based Modeling
Case Study: District 6 of Isfahan City1351657615510.22059/jte.2020.282224.1008175FAImanKeyfarokhiPh.D. Student, Dept. of Economics, University of IsfahanNematollahAkbariProfessor, Dept. of Economics, University of Isfahan0000-0003-2160-2513ShekoofehFarahmandAssociate Professor, Dept. of Economics, University of Isfahan,AliAsgaryAli Asgary, Associate Professor of Disaster, York UniversityJournal Article20190527This study tries to predict the rental rates in district six of Isfahan for five years in the future by using an agent-based model. According to this simulation, district of Hezar Jerib has the highest and Hemat Abad has the lowest rental rate. Districts of Sa'adat Abad, Abshar, Baghnegar, Feiz, Masjed Mosala, Kuye Emam, Takht-e Foulad and Shahid Keshvari are followed by the district of Hezar Jerib. From the demand point of view, the high rental rate in Hezar Jerib district is due to higher comfort index in that region. From the supply point of view, the high rental rate in Hezar Jerib district is due to low supply of residential units. JEL Classification: R31, R21, C63, E17This study tries to predict the rental rates in district six of Isfahan for five years in the future by using an agent-based model. According to this simulation, district of Hezar Jerib has the highest and Hemat Abad has the lowest rental rate. Districts of Sa'adat Abad, Abshar, Baghnegar, Feiz, Masjed Mosala, Kuye Emam, Takht-e Foulad and Shahid Keshvari are followed by the district of Hezar Jerib. From the demand point of view, the high rental rate in Hezar Jerib district is due to higher comfort index in that region. From the supply point of view, the high rental rate in Hezar Jerib district is due to low supply of residential units. JEL Classification: R31, R21, C63, E17https://jte.ut.ac.ir/article_76155_e4ab2a522e901766a70ab99750fba3df.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Competition Model of Firms in Duopoly Market Based on Differential Game and with Delayed Control VariablesCompetition Model of Firms in Duopoly Market Based on Differential Game and with Delayed Control Variables1671867615610.22059/jte.2020.279528.1008155FAAliMohagharDepartment of Industrial Management, School of Management, University of TehranKianNajafzadehPhD Student, Department of Industrial Management, School of Management, Tehran UniversityGholam RezaRokni LamoukicAssociate Professor, School of Mathematics, Statistics and Computer Science, College of Science,Journal Article20190419The firms in duopoly markets adjust their behavior under strategic interactions to attain more market share and try to compete by different policies. In this study, we used non-delayed and delayed forms of differential game model to investigate competition between firms. Regarding quality as one of the state variables and related control variables of two firms, we have compared the results of two models and have discussed about the results of delayed form. When the delay, which is an unfavorable phenomenon, happens, the firms must behave corresponding to the equilibrium relations derived from the delayed differential game model. Effort of each firm to improve its product quality is influenced by either its delay or its competitor’s delay. The firm having less delay is able to achieve higher quality by means of less effort. JEL Classification:C6, C7, D43, L13, M3, O3The firms in duopoly markets adjust their behavior under strategic interactions to attain more market share and try to compete by different policies. In this study, we used non-delayed and delayed forms of differential game model to investigate competition between firms. Regarding quality as one of the state variables and related control variables of two firms, we have compared the results of two models and have discussed about the results of delayed form. When the delay, which is an unfavorable phenomenon, happens, the firms must behave corresponding to the equilibrium relations derived from the delayed differential game model. Effort of each firm to improve its product quality is influenced by either its delay or its competitor’s delay. The firm having less delay is able to achieve higher quality by means of less effort. JEL Classification:C6, C7, D43, L13, M3, O3https://jte.ut.ac.ir/article_76156_3b146217fedc75f4c9d7cf1c4777c32b.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Government Size, Shadow Economy, Inequality of Income, Iran, Smooth Transition Regression (STR)Government Size, Shadow Economy, Inequality of Income, Iran, Smooth Transition Regression (STR)1872147618910.22059/jte.2020.270806.1008062FATohidQhasemnajadDepartment of Economics, Faculty of Economics and Management, Urmia University, UrmiaYousefMohammadzadehAssistant Professor, Economic department, Economic and Management Faculty, Urmia University, Urmia0000-0002-4364-5832AliRezazadehAssistant Professor, Department of Economics, Faculty of Economics and Management, Urmia University, UrmiaJournal Article20181204This study investigates the relationship between shadow economy and inequality of income using smooth transition regression model (STR) as one of the most prominent regime switching models, over the period 1969 to 2015. To this end, we used the Consumption expenditure ratio to GDP as the government size variable and transition variable. Gini coefficient was used to measure income inequality and data on the shadow economy have been extracted using the MIMIC approach. Linearity test results indicate non-linear relationship between shadow economy and income inequality. The results show that the threshold level is 2.67% and estimated slope parameter is 8.20. In the first regime, shadow economy has a positive impact on income inequality, but the impact of the per capita income is negative and significant. In the second regime, shadow economy and per capita income have a different effect than income on inequality. In other words, with increasing government size, shadow economy has a negative impact on income inequality, but the impact of per capita income is positive. JEL Classification: O17, D63, H11This study investigates the relationship between shadow economy and inequality of income using smooth transition regression model (STR) as one of the most prominent regime switching models, over the period 1969 to 2015. To this end, we used the Consumption expenditure ratio to GDP as the government size variable and transition variable. Gini coefficient was used to measure income inequality and data on the shadow economy have been extracted using the MIMIC approach. Linearity test results indicate non-linear relationship between shadow economy and income inequality. The results show that the threshold level is 2.67% and estimated slope parameter is 8.20. In the first regime, shadow economy has a positive impact on income inequality, but the impact of the per capita income is negative and significant. In the second regime, shadow economy and per capita income have a different effect than income on inequality. In other words, with increasing government size, shadow economy has a negative impact on income inequality, but the impact of per capita income is positive. JEL Classification: O17, D63, H11https://jte.ut.ac.ir/article_76189_964dbfcbe013d88c6e39dc4d7b92108f.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Between-group adverse selection: Evidence from Irans’s group supplemental health insuranceBetween-group adverse selection: Evidence from Irans’s group supplemental health insurance2152327615710.22059/jte.2020.255535.1007891FAMohammadVesalAssistant professor at Graduate School of Management and Economics, Sharif University of Technology, Tehran, Iran0000-0003-3088-7936GholamrezaKeshavarz HaddadAssociate Professor at Graduate School of Management and Economics, Sharif University of Technology, Tehran, Iran0000-0001-5873-8217MohamadrezaChaghomiEconomics Department, Graduate School of Management and Economics, Sharif University of Technology, Tehran, Iran0000-0001-6796-649XJournal Article20180409Asymmetric information in insurance markets leads to adverse selection and moral hazard. The amount of asymmetric information could change over time due to learning. Unlike other insurance contracts, supplementary health insurance contracts in Iran are in group form. Therefore, between group asymmetric information might play an important role. In this article, positive correlation test is used to test presence of between group asymmetric information. Since acute hospital disease category does not have moral hazard, adverse selection is separately identified. Finally, using the temporal variation in insurance contracts, moral hazard is separated from learning. The data is a panel of insurance contracts from Asia Insurance Company, for two types of paraclinical and hospital health services, during the period of 2011-2016. Results show no asymmetric information for acute hospital disease and since there is not any moral hazard, we can conclude no between group adverse selection. For paraclinical services, we find significant evidence for asymmetric information, mainly due to moral hazard. We also found evidence of learning for insured groups. JEL Classification: I11, D82, D83, C33Asymmetric information in insurance markets leads to adverse selection and moral hazard. The amount of asymmetric information could change over time due to learning. Unlike other insurance contracts, supplementary health insurance contracts in Iran are in group form. Therefore, between group asymmetric information might play an important role. In this article, positive correlation test is used to test presence of between group asymmetric information. Since acute hospital disease category does not have moral hazard, adverse selection is separately identified. Finally, using the temporal variation in insurance contracts, moral hazard is separated from learning. The data is a panel of insurance contracts from Asia Insurance Company, for two types of paraclinical and hospital health services, during the period of 2011-2016. Results show no asymmetric information for acute hospital disease and since there is not any moral hazard, we can conclude no between group adverse selection. For paraclinical services, we find significant evidence for asymmetric information, mainly due to moral hazard. We also found evidence of learning for insured groups. JEL Classification: I11, D82, D83, C33https://jte.ut.ac.ir/article_76157_d401f83482b3248fdb06b598d3a591f5.pdfUniversity of TehranJournal of Economic Research (Tahghighat- E- Eghtesadi)0039-896955120200420Assessing the Economic Effects of Iran’s Membership in Shanghai Cooperation Organization: An Application of Global Simulation ModelAssessing the Economic Effects of Iran’s Membership in Shanghai Cooperation Organization: An Application of Global Simulation Model2332687615810.22059/jte.2020.275972.1008118FASaraMardihaUniversity of Isfahan/faculty of Administrative sciences and EconomicsKarimAzarbaiejaniFaculty Member of University of Isfahan, Faculty of Administrative Sciences and Economics0000-0002-6561-0809Seyed KomailTayebiFaculty Member of University of Isfahan, Faculty of Administrative Sciences and Economics0000-0002-3047-7497DavoudJafaryMaster of Science in Economics, University of Isfahan, Faculty of Administrative Sciences and EconomicsJournal Article20190310Today, the Shanghai Cooperation Organization is considered as a major regional organization in order to pursue trade liberalization among it’s members. Since Iran is now an observer state in the Shanghai Convention and is at the stage of its accession to the treaty, the purpose of this study is to assess the potential economic impacts of Iran's membership in the SCO using the Global Simulation model (GSIM). Accordingly, four scenarios including 25%, 50% and 75% reduction in tariff rates (incomplete liberalization) and 100% eliminatiom (full liberalization) in tariff rates are considered. The effects of tariff liberalization are estimated at 13 major export commodities in both scenarios. Research findings suggest that joining Iran into the Shanghai organization and eliminating tariff rates will increase the net welfare and cause trade creation in the Iran and Shanghai bloc. However, the welfare effects and the degree of trade creation in full liberalization are more than incomplete liberalization.Therefore, it is possible to consider Iran’s membership in the Shanghai agreement as a useful convergence. JEL Classification: F47, F17, F13Today, the Shanghai Cooperation Organization is considered as a major regional organization in order to pursue trade liberalization among it’s members. Since Iran is now an observer state in the Shanghai Convention and is at the stage of its accession to the treaty, the purpose of this study is to assess the potential economic impacts of Iran's membership in the SCO using the Global Simulation model (GSIM). Accordingly, four scenarios including 25%, 50% and 75% reduction in tariff rates (incomplete liberalization) and 100% eliminatiom (full liberalization) in tariff rates are considered. The effects of tariff liberalization are estimated at 13 major export commodities in both scenarios. Research findings suggest that joining Iran into the Shanghai organization and eliminating tariff rates will increase the net welfare and cause trade creation in the Iran and Shanghai bloc. However, the welfare effects and the degree of trade creation in full liberalization are more than incomplete liberalization.Therefore, it is possible to consider Iran’s membership in the Shanghai agreement as a useful convergence. JEL Classification: F47, F17, F13https://jte.ut.ac.ir/article_76158_28861fc2160a6423015803d38ac7a3f5.pdf