فصلنامه مطالعات اقتصادی کاربردی ایران
پیاپی 23 (پاییز 1396)

In an open economy, the exchange rate is an important factor in the design of monetary policy. The nominal exchange rate may serve as the underlying objective of monetary policy in the short to medium term in its capacity as an intermediate target. The real exchange rate is of concern to policymakers not least because of its importance in determining the competitiveness of domestic goods in global markets, but because of its role as the driving force behind the expenditure switching effect. Many of studies also show that the real exchange rate directly affects behavior on the production side of the economy.
This paper underscores the importance of the direct exchange rate channel in the transmission of monetary policy effects in an open economy forward looking model. In fact, we study the impact of exchange rate shock on macroeconomic variables such as inflation and output in the context of incomplete exchange rate pass-through, using a new Keynesian dynamic stochastic general equilibrium (DSGE) model with microeconomic foundations for a small open economy, adjusted for Iran. DSGE models as one of the major developments in macroeconomics in the past few decades are based on the adoption of the inter-temporal utility maximization paradigm.
In our model, we assume that there are two economies. On the one hand, there is the domestic economy, designated as a small and open economy, and on the other hand, there is a foreign economy, considered considerably bigger compared to the domestic one and relatively closed. These features influence their mutual relations and it holds that the domestic economy does not influence the development in the foreign economy. In this paper, we model relations for the development in the domestic economy, and the rest of the world, i.e. the foreign economy, enters the model exogenously. In our model, it is assumed that the Central Bank minimizes a loss function, taking into account the deviation of inflation from its target, output stabilization. In addition, incomplete exchange rate pass-through has been considered by the means of nominal import price rigidity and modelling of the path which exchange rate changes affect the economy.
In line with our purpose, two kinds of policies based on discretion and commitment are introduced into the model. Period by period optimization and the treatment of expectations as being fixed characterize discretionary policymaking in the forward looking framework. The first characteristic implies that the policymaker sets policy anew every period. The other characteristic suggests that the policymaker treats the expectations of agents as constants when re-optimizing every period. But Commitment implies that the policymaker follows a rule systematically. In view of the fact that the policymaker cares about deviations of inflation from target and deviations of the real output gap from its target level, the policy rule focuses on the two target variables.
Bayesian methods have been applied in order to estimate structural parameters of the model. To do so, we have used Central Bank's data during 1369-1393. Then, the model is simulated under two policies of discretion and commitment and the effect of exchange rate shocks on key economic variables in these two situations is compared.
The results of the research indicate that the initial effect of exchange rate shock on all variables is roughly the same in both scenarios, but in discretion mode it takes more time to regain long-term balance. Our analysis also reveals that the output-inflation trade-off is more favorable under commitment than under discretion in part because of the existence of the direct exchange rate channel, and the stabilization bias under discretion is weaker in an open economy relative to a closed economy. These results confirm the importance of the exchange rate in the design and implement of monetary policy.
This paper underscores the importance of the direct exchange rate channel in the transmission of monetary policy effects in an open economy forward looking model. In fact, we study the impact of exchange rate shock on macroeconomic variables such as inflation and output in the context of incomplete exchange rate pass-through, using a new Keynesian dynamic stochastic general equilibrium (DSGE) model with microeconomic foundations for a small open economy, adjusted for Iran. DSGE models as one of the major developments in macroeconomics in the past few decades are based on the adoption of the inter-temporal utility maximization paradigm.
In our model, we assume that there are two economies. On the one hand, there is the domestic economy, designated as a small and open economy, and on the other hand, there is a foreign economy, considered considerably bigger compared to the domestic one and relatively closed. These features influence their mutual relations and it holds that the domestic economy does not influence the development in the foreign economy. In this paper, we model relations for the development in the domestic economy, and the rest of the world, i.e. the foreign economy, enters the model exogenously. In our model, it is assumed that the Central Bank minimizes a loss function, taking into account the deviation of inflation from its target, output stabilization. In addition, incomplete exchange rate pass-through has been considered by the means of nominal import price rigidity and modelling of the path which exchange rate changes affect the economy.
In line with our purpose, two kinds of policies based on discretion and commitment are introduced into the model. Period by period optimization and the treatment of expectations as being fixed characterize discretionary policymaking in the forward looking framework. The first characteristic implies that the policymaker sets policy anew every period. The other characteristic suggests that the policymaker treats the expectations of agents as constants when re-optimizing every period. But Commitment implies that the policymaker follows a rule systematically. In view of the fact that the policymaker cares about deviations of inflation from target and deviations of the real output gap from its target level, the policy rule focuses on the two target variables.
Bayesian methods have been applied in order to estimate structural parameters of the model. To do so, we have used Central Bank's data during 1369-1393. Then, the model is simulated under two policies of discretion and commitment and the effect of exchange rate shocks on key economic variables in these two situations is compared.
The results of the research indicate that the initial effect of exchange rate shock on all variables is roughly the same in both scenarios, but in discretion mode it takes more time to regain long-term balance. Our analysis also reveals that the output-inflation trade-off is more favorable under commitment than under discretion in part because of the existence of the direct exchange rate channel, and the stabilization bias under discretion is weaker in an open economy relative to a closed economy. These results confirm the importance of the exchange rate in the design and implement of monetary policy.

International trade is an important channel for transmitting the effect of an oil shock to the trade balance and macroeconomic variables. In an international framework, the trade channel transmits oil shocks across economies through changes in the non-oil traded goods. Most researches that have investigated the effect of an oil shock on macroeconomic variables in Iran have ignored the role of trade channel. The main goal of this paper is to fill this gap in the literature for Iran as an oil producing and exporting country. More specifically, we develop and solve a New Keynesian Dynamic Stochastic General Equilibrium (DSGE) model for an open economy to study the effect of an oil shock on trade balance and macroeconomic variables in Iran.
The model consists of households, firms, government, central bank and foreign sector. Following Kia and Darrat (2007), Walsh (2010) and Sanchez (2011) household derives utility from consuming a final good, holdings of domestic and foreign real balances and leisure. This study is different from other researches on Iranian economy by introducing foreign real money balance in the utility function of our representative household. Production sector consists of domestic goods producing firms and intermediate goods producing firms. Production of these goods requires capital, labor, and oil. The investment bundle is a composite of the domestically produced good and inputs imported from abroad. The consumption bundle is a composite of the domestically produced good, oil consumption and imports of foreign goods. Thus, oil is considered in both the production function and the consumption basket. Another distinct feature of this study from other Iranian studies is the presence of oil in both production function and consumption bundle. This allows us to examine the dynamics of trade balance in response to an oil shock.
In order to evaluate the model, we compared the moments of actual and simulated data. Our finding confirms the validity of model. The impulse response functions show that an oil shock to Iranian economy reduces the ratio of non-oil trade balanced to GDP. This might be due to the fact that a positive oil shock has an adverse effect on the growth rate of foreign oil importing countries. Hence, lower economic growth of oil importing countries will result in lower imports from oil producing countries. This in turn will deteriorate the non-oil trade balances in oil exporting countries. Given the role of non-oil trade balance in boosting employment and generating jobs and foreign reserves, this finding suggests that policymakers in Iran should take appropriate measures to reduce the economic dependence on oil sector as a major source of income. In addition, a positive oil shock has direct effect on the ratio of total trade balance to GDP. In other words, in an oil-exporting country such as Iran in which oil is an important source of foreign income, an increase in oil price results in an improvement in trade balance. However, the indirect effect of oil shock on the trade balance is negative. However, our result shows that the net effect of oil shock on the trade balance of Iran as an oil-exporting country is positive.
Moreover, we find out that oil shock will transfer income from oil-importing country to the oil-exporting country. Therefore, positive oil shock induce wealth effect and cause the GDP to increase. Moreover, a positive oil shock results in higher investment. In addition, oil shock changes the cost of producing goods and services and cause inflation.The impulse responses show that adjustment of trade balance is slower than that of other macroeconomic variables.

In recent years, the causes of double-digit inflation in the economy of Iran have been the biggest challenge for Iranian researchers. However, time inconsistency has been paid less attention while according to Kydland and Prescott (1977), time inconsistency of monetary policy can be the most important cause of inflation bias.
A policy is time inconsistent or dynamic inconsistent when it is considered as the best policy for particular time in the future, but it does not remain so, when that particular time actually arrives. There are two possible mechanisms that have been considered for such a time inconsistency. (i) Strotz(1955-1956) explain that time inconsistency is because of changing preferences, (ii) Kydland and Prescott(1977) consider another explanation that is based on agent’s rational expectation. The main idea is, when people expect low inflation, central bank thinks of high inflation. If people understand it, they predict higher inflation. In this situation, predicted inflation is optimal inflation. In other word, while inflation policy is optimal at first, high inflation policy will be optimal in the end. We use the second mechanism in this paper. Barro and Gordon (1983) have explained time inconsistency of monetary policy as follow: in a discretionary regime, central banker can print more money and make more inflation than people’s expectation. Benefits of this surprising inflation might provide more economic activities or reduce government’s debt. However, if people, due to their rational expectation, understand it and adjust their expectations with it, then policy maker will not reach his target at all. Besides that, due to increased money supply, the level of prices will grow.
So the question that arises here is how much of the inflation is due to discretionary behaviors in applying monetary and fiscal policies? In other words, what is the inflationary bias caused by the Time Inconsistency of monetary and financial policies?
In the present study, the framework of Barro-Gordon has been applied to calculate the inflation bias of time inconsistency of monetary and fiscal policies. In fact, we have extended Walsh (2010)’smodel by adding fiscal variable. These models consist of two main sections: loss function and the supply curve. According to the structure of the economy of the developing countries, the fiscal and monetary policies are dependent and are determined by a third person (the president). Thus, a general loss function which consists of fiscal and monetary variables is used. In fact, the lack of independence of the central bank is considered in this model.
What distinguishes this study from other studies, include: Calculating the inflation bias using a model that considers the time inconsistency of monetary and fiscal policies simultaneously.
Unlike Surico (2008), we used symmetric loss function.
Calculating inflation bias in Each Economic Development plan of Iran
The model solution will be done by two approaches of discretion and commitment. After applying the optimization, inflation bias will be the difference of results of these two approaches. Moreover, the inflationary bias of the model is calculated based on Iran’s economy data over the period of 1991-2016. This bias is then calculated for each of the country's five-year economic development plan.
The results show high inflation bias in Iran (9.8%). Furthermore, based on the results, the first and the third economic development plans have the lowest and the highest inflation bias, respectively. Besides that, it can be seen, predicted inflation in third and second part of fifth economic development plans, have significant difference with performance inflation. In other words, the present model has failed to provide an adequate estimate of the inflation of these two periods. It seems that the reason is considering high target inflation in two plans.

Exchange rate pass-through is one of the important issues in the macroeconomics literature. A change in exchange rate represents a change in relative prices and so the allocation of resources in society will be affected and the competitiveness of domestically manufactured goods in world markets will be changed. The price stickiness is the main factor affecting exchange rate pass-through (ERPT). If prices are sticky, with a change in exchange rate, firms do not transfer all of this change to prices and they change their profit margin.
In contrast to earlier studies for Iran, where exchange rate pass-through is treated as an unconditional phenomenon, our analyses are made conditional on the structural shocks. An important issue which has been take lots of consideration is that exchange rate pass-through conditional on each shock is different from another shock and policy makers should take this issue into consideration. The shock which has caused movement in exchange rate has an important role in how exchange rate is passed through prices. For the analysis of exchange rate pass-through conditional on each shock (technology Shock, oil revenues, foreign demand, money demand, foreign interest rate and monetary policy), a dynamic stochastic general equilibrium (DSGE) model for Iran is developed. The model includes a monopolistic competition and price stickiness. The economy consists of households, monetary authorities, government, firms including a final-good producer, intermediate-goods producer, importing firms and oil sector. The final products, used in consumption and investment, are produced by competitive firms. Competitive firms use domestic and foreign intermediate goods as inputs. Intermediate-goods producers are monopolistically competitive firms that use capital and labor as inputs. Domestic intermediate goods are also exported to the other countries of the world. Foreign intermediate goods are imported by monopolistically competitive importing firms at world prices. Then these goods are sold to domestic final producers at domestic currency. Prices which set by monopolistic firms are costly to changes and therefore prices are stickiness. This is the cause which in short time exchange rate pass -through is incomplete.
Using DSGE model for calculating conditional exchange rate pass through has several advantages. First, and most importantly, it takes into account the fact that prices and the nominal exchange rate are simultaneously determined. Second, because our model is structural, the analysis can be made conditional on the shocks. Exchange rate pass-through conditional on each shock is derived by the ratio of the covariance of impulse response of price and exchange rate to the variance of impulse response of exchange rate for every period then the patterns are showed graphically. Aggregate pass-through to import prices for each period which is equal to the sum of conditional pass-through coefficients in each time weighted by the contribution of each shock is also computed.
Results show that conditional exchange rate pass-through in Iran is incomplete and the degree of exchange rate pass-through conditional on each shock is different from another shock and after 20 quarters it reaches to 40 to 70 percentages. Also a test for analyzing the importance of price rigidity in exchange rate pass-through is performed. The results show that the higher the degree of price stickiness, the lower the degree of conditional exchange rate pass-through will be. One of the reasons why exchange rate pass-through is high in Iran is low degree of price stickiness. Importing firms are limited in Iran and they aren’t competitive firms and when a shock occurs, without the fear of losing the market share, they change the prices.

Labor market issues as one of the four economic market in terms of dealing with HR always has special attention is Basic role for economic and social politicians, in targeted desighning is compilation in labor market , to provide appropriate background is context foe operation at full employment is in the center of authorities. Policymakers is politicians in every countries. Reducing unemployment level is one of the governmental target that they try a lot to achieve it. Since acheuing desirable development depends on employing Human Resources. In the other hard lack of using HR appropriately lead to lack of societies financial facilities utilization. As a result growth is development will not occure and following that, the rate of unemployment increase more re more to cause poverty a deprivation extend in the society. Economic development witheat effective government support is not possible. So the government has to direct the society and economic to a level to economic and social development. In economic literature, unemployment and inflation rate are two important variable and two key indicator in relation with the way of economic condition. The significance tow indicator are so high that, government in the way of rote give – take, refer to these variable, and their changed are as the government success or fail . So achieve optimum unemployment for every countries economic has on essential place. Of course, it is clear that determining the optimal unemployment rate, without paying attention to inflation rate and other important variable is a fault that we have to pay attention to it.Philips, reveal that there is a negative relation between increase the wage rate and unemployment rate, by England data that were in his important survey Philips curve. Immediately by economic and political makers and one of the reasons was its compatibility with the inflation changes theory such as: inflation theory caused by demand and cost pressure. Also the policymaker can use the Philips curve slope to reach the intended and unemployment rate, target the corresponding inflation. In addition social loses against social welfare is one of the issues in economic literature with a lot of partisan. Economists take a look at the social welfare or losses welfare while they are recognizing variable. In this respect some of variables have more effect on the social welfare is some of the variables have more effect on the social losses. Since the time that unemployment is inflation increases the social losses is decrease the social welfare minimizing social losses function means to maximization welfare. So function tar set is to minimize the social losses. In this study with using give—take in inflation are unemployment along with Philips expectation are with the dynamic optimized control approach are the account method change has been calculated thrush minimizing social losses according to unemployment optimized rate the resin mohcate that optimized unemployment rate in Iran should be nearly %8 and the deviation of unemployment rate have to decrease the optimized unemployment rate. Using financed are income polices simultaneously is consider to parallel effect on inflation. Are the methods that have this ability to help government to achieve this targest. Inflation is unemployment rate in Iran's economic are more the optimized rate is this lead to increase the social losses in economics. In order to reduce the unemployment is inflation its necessary to precise is be aware of the country's economic atmosphere because effort for reducing inflation is unemployment with various economic policy is not possible.

One of the biggest global challenges related to environmental pollution is the climate change induced mainly by anthropogenic emissions of CO2 and other greenhouse gases (GHG). Human activities since the beginning of the Industrial Revolution (taken as the year 1750) have produced a 40% increase in the atmospheric concentration of carbon dioxide . This increase has occurred despite the uptake of a large portion of the emissions by various natural "sinks" involved in the carbon cycle. Anthropogenic carbon dioxide (CO2) emissions (i.e., emissions produced by human activities) come from combustion of fossil fuels, principally coal, oil, and natural gas, along with deforestation, soil erosion and animal agriculture.
One of the most important sources of the emission of greenhouse gases, especially carbon dioxide, is a variety of activities in important economic sectors, while one of the leading parts in carbon emissions is industry. In this study, using input- and output-based distance functions, the Marginal CO2 Abatement Costs as one of the most important greenhouse gases emitted during the development of industry sector of Iranian economy was measured for industrial workshops having 10 workers or more in the years 2008 to 2013. The analytical framework for shadow price estimation consists of three main steps, i.e. constructing an environmental production technology by distance function, deriving the shadow-pricing formula, and formulating a econometric model to compute the shadow prices. using Stata software 13, and tests Chow, Hausman and Pagan tests reveals that the models proposed in this study, of which type of pool or fixed and random effects model. We used sfpanel command to parameter estimation due inefficiency component of the model. The estimation is done based on maximum likelihood method. At the end of using the results of parameter estimation, marginal CO2 abatement costs is calculated for each industry sub-sectors. In this regard, after gathering the required data, the concept of shadow price of emission of this pollutant was used. The results show that different industrial subsectors have different Marginal CO2 Abatement Costs and the trend of Marginal CO2 Abatement Costs have increased dramatically during the study period for the industrial sector in such a way that the calculated shadow price in 2013 has grown 221 percent comparing to 2008. Also, the different results from two types of distance function which are used in this study show that the choice of method or model used to estimate the shadow price is of utmost importance.

Industrial clusters are the geographic concentration of mainly small and medium enterprises (producing, complementary and supporting companies) facing with common challenges and opportunities.One of the main functions of industrial clusters is to provide the conditions required for competitiveness and export promotion of clusters members and stakeholders. Cluster development program in Iran, has been started since one decade ago and needs to be investigated in terms of its effect on the export potential of clusters members. This paper has studied the effects of industrial clusters on export promotion of industrial firms using data gathered from manufacturing establishment (with more than 10 employees) in Iran.
Levin, Lin, Chu Test and Im, Pesaran, Shin Test was used to test the stationarity of variables. In order to test the existence of co-integration relationship between variables, Kao and Pedroni tests were applied. Generalized method of moment is used to estimate the dynamic panel regression. For this purpose, the dynamic and static functions of industrial export supply have been estimated considering industrial clusters as one of the independent variables included in the functions. The null hypothesis that the over-identifying restrictions are valid was tested by Sargan statistic. Arellano and Bond test was used to test the serial correlation. Required data was gathered from Iran manufacturing establishment (with more than 10 employees) during the period 2001-2012.
Discussion and theoretical and empirical background of industrial clusters studies strongly support the effective role of industrial cluster in competitiveness and export performance um enterprises. The findings of both estimated dynamic and static industrial export supply functions in this paper reveal that industrial cluster and firms agglomeration in form of cluster, has a positive and statistically significant effects on industrial firms export. According to the estimated dynamic industrial export supply function, the elasticity of export supply with respect to industrial clusters was estimated around 0.6 which means that one percent increase in the situation of industrial clusters can leads to 0.6 percent increase in industrial export. Based on the estimated static industrial export supply function, however, the elasticity of export supply with respect to industrial clusters was estimated around 0.02 which is statistically significant and shows that one percent increase in the situation of industrial clusters can leads to 0.02 percent increase in industrial export. These findings are compatible with the theoretical expectations regarding the relationship between clustering and export.
Industrial export is also positively influenced by industrial firm’s production and exchange rate and is negatively affected by manufacturing export price index. According to the estimated coefficients of variables included in the dynamic and static industrial export supply functions, exchange rate has the strongest positive effect- compared with other variables- on export of industrial clusters. In other words, one percent increase in the exchange rate can leads to 2.6 percent increase in industrial cluster export. This reveals that the elasticity of industrial cluster export with respect to exchange rate is greater than one. Provincial GDP is another variable which positively affects the level of industrial cluster exports so that one percent increase in gross domestic production leads to 0.7 percent increase in industrial cluster export located in different provinces in Iran. Export price index, however, has a negative and significant effect on industrial cluster export. This result is compatible with the theoretical expectations. The elasticity of industrial cluster export with respect to export price index is 0.3 which is less than one. It is inferred, therefore, that increasing in the price of export products of clusters did not reduce the export total revenue gained from industrial clusters.

One of the main goals of the economy of each country is to achieve an appropriate economic growth and Prices stability. To achieve these goals, governments employ two important tools, financial and monetary policies. A financial policy in which the level of government tax and spending is determined, and a monetary policy that mainly deals with managing money supply and adjusting interest rates. The financial policy is used by the government of each country while the monetary policy is used by the central bank. In resently years, debates over the relationship between financial and monetary policies have become more important in the economic literature. One of the important goals of fiscal policy makers is to keep the state budget balanced. In the event of a budget deficit, the government may borrow from the central bank or withdraw its deposits in central bank, which means money creation and financial dominance. that can cause inflation. In this situation, if the government can finance the internal deficit and the temporary budget deficit without changing the policy or at the level of prices, then a stable financial policy has been used (Kuncoro et al., 2013, p. 53). On the other hand, the implementation of monetary policy to control of inflation, will increase the rate of interest, and then the future budget deficit will increase due to the financial obligations of the government, which could lead to more money and higher inflation (Baieng and et al., 2006, p. 56). Sargent and Wallace (1981), showed that monetary policy, without coordinating with fiscal policies, could not maintain price stability in the short and in the long run. ó Actually, the macroeconomic goals, such as maintaining the stability of prices and growth of production depend on the proper and accurate monetary and financial policies and the coordination of these policies. In this research, we study the response of monetary policy makers to financial policies, as well as the response of financial policy makers to monetary policies, emphasizing the goal of economic stability, in Iran. The ratio of the amount of liquidity to GDP and the ratio of budget deficit to GDP respectively are considered as criteria of monetary policy and financial policies. we have tried using 1978-2013 time series data and econometric method of auto distributed lag (ARDL) and examines the dynamic relationship between fiscal and monetary policies in the face of changes in macroeconomic variables economy. The results show that the reaction of monetary policy in the face of increasing the ratio of budget deficit to GDP, appears to increase the ratio of liquidity to GDP. Also in the face of increasing the ratio of liquidity to GDP, the fiscal policy makers decrease the ratio of budget deficit to GDP. These results indicate the dominance of fiscal policy on the economy of Iran. Comparing coefficients of the variables of liquidity in financial policy reaction function and budget deficit in monetary policy reaction function shows that sensitivity of monetary policymakers in the face of fiscal policy is more than sensitivity of fiscal policymakers in the face of monetary policy. Therefore, following the increase in budget deficit, which is an instability factor in macroeconomics, the reaction of central bank, may increase inflation and therefore further instability. Other results show positive and significant relationship between oil price, interest rate, government debt to central bank, output gap and RM, inflation, exchange rate and RPB. Also the results show negative and significant relationship between inflation, exchange rate and RM and interest rate, oil price and RPB. Relationship between RPB and theoutput gap is not significant.

Economic growth has always been one of the core objectives of economic system, and this growth is not possible without funding. Insurance companies are financial institutions that beside the effective development and by providing capital economic security can create funds during the intervals of receiving premium or paying damages in order to provide the context for economic growth by accumulation of capital.
In a classification, insurance market activities are divided into two parts of life insurance and non-life insurance. Life insurance is the fund of risks that threaten humans’ health, life, and ability of working. Therefore, the risks that are mainly covered in individuals’ insurance are incident, illness, permanent disability, retirement, old age, and death. Non-life insurance includes in fact all insurance subjects except life insurances. This collection includes accident insurance, health insurance, fire insurance, cargo insurance, vehicle insurance (third-party and surplus insurance, driver’s accident insurance and car body insurance), ship insurance, aircraft insurance, liability insurance, engineering insurance, oil and energy insurance, money insurance, credit insurance and other insurance types.
Therefore, the goal of this research is to investigate the impact of insurance on economic growth of 50 countries. In this study, two samples including 30 selected developed countries and 24 selected developing countries are studied. Various criteria such as countries’ diversity of geographic location and the availability of data have been used in the selection of countries. All data on the penetration rate of insurance have been extracted from the Sigma Journal and other information are extracted from the World Bank database. The distinction between this research and previous studies is in existence of the variables of this research (life and non-life insurance, physical capital accumulation, human capital, economic freedom, and accumulation of research and development costs) in the form of production function in the newer time period and more statistical society, and the use of dynamic panel statistical method. The endogenous growth model has been used to test the effect of insurance on economic growth.
The applied model is a dynamic panel model which is estimated through the two-step generalized method of moments (GMM) for panel data in the interval 2000-2015 using Eviews and Stata software. This method is more suitable than other methods for at least three reasons. Endogenous variables can be used in this method. One of the advantages of this method is that it allows to use the interruption of these variables as appropriate tools for controlling the endogeneity. The second advantage of this method is that one can insert the dynamics of the variable under consideration in the model, and the third advantage is that this method can be used in all time-series, cross-sectional and panel data. To do this research, four regression models were considered to determine the impact of life insurance on the economic growth of developed countries, to determine the impact of non-life insurance on the economic growth of developed countries, to determine the impact of life insurance on economic growth of developing countries, and to determine the impact of non-life insurance on economic growth of developing countries. The results of the four estimates suggest that life and non-life insurance have a positive and significant effect on the economic growth of developing and developed countries. In developing countries, the impact of non-life insurance on economic growth is greater than life insurance, while in developed countries, life insurance has a greater role. The effect of life and non-life insurance on the growth of developing countries is higher than developed countries. Therefore, due to the low level of per-capita income and GDP in developing countries, the impact of life and non-life insurance on their economic growth is higher than that of developed countries. There is a long-term relationship between life and non-life insurance in the two groups of selected countries. Also, other results showed the positive significant impact of the accumulation of physical capital, human capital, accumulation of research and development costs, and trade openness on economic development of the both groups of selected countries.

Increase in GDP per capita is a measure of economic performance of a society. Prior to this, the existing theories emphasized on the formation of physical capital and human capital as a factor increasing GDP per capita, but one of the factors affecting the GDP, is the cultural capital. The aim of this study is to estimate the cultural capital of Iran's provinces and its effects on GDP per capita in the world. So, the definition provided by Throsby is used for cultural capital. According to this definition , cultural capital is as a stock of tangible and intangible cultural expressions, The stock of tangible cultural capital exists in buildings, structures, sites and locations endowed with cultural significance (heritage) and in artworks and artifacts existing as private goods. Intangible cultural capital comprises the set of ideas, practices, beliefs, traditions .
Therefore , using 36 variables related to cultural capital, the required data was collected and normalized. Then cultural capital has been calculated for the 24 provinces from 2004 to 2011, then using the Generalized method of moments, the impact of cultural capital on GDP has been tested and reviewed.
The results obtained, confirm the positive effect of cultural capital on GDP per capita. It means that increase of cultural capital, raises GDP per capita. Hence policy makers of economic and cultural should be more consider dominant social culture and its impact on economic issues and policies adopted to improve cultural indicators and cultural capital.
According to research findings, it can be argued that cultural capital has a positive and significant effect on per capita GDP,which is consistent with the theoretical foundations.
Accordingly, investing in culture and increasing cultural capital can have a positive impact on per capita gross domestic product and, as a result, one of the primary conditions for improving economic prosperity. For example, when the culture of reading and reading is spreading among people, it will increase the level of awareness and learning of individuals in a community, and this helps to promote cultural capital and increase labor productivity in a community, so increasing and improving cultural capital And as a result, upgrading human capital can not have a positive impact on GDP. Another example that can be discussed in this context is the expansion of legal culture, when this culture spreads among people in a society, it also increases investment in a society, as one of the most important preconditions for an investment It is necessary that there are certain and consistent rules and, of course, compliance with those rules, the person who invests, along with the other conditions that he is considering, also looks at the laws in his field of work, so if he has created this assurance That the laws related to his field of work are right.
Therefore, one of the policy recommendations derived from this research is an attempt to promote the culture of society in order to improve the economic situation. The institutionalization of values ​​and norms such as respect for laws and regulations, increasing attention to books and reading, spending and passing, the importance of religion and other variables affecting cultural capital among the community can have a positive impact on the economic situation of society. Hence, economic and cultural policymakers should be more aware of the prevailing culture of society and its impact on economic issues and pursue policies to improve cultural indicators and increase cultural capital.