panel data method

Economic and political convergence within a region offers numerous advantages to the constituent countries of that region. Given Iran's imperative need to bolster its trade relationships with other nations as a strategy to mitigate the economic sanctions it faces, this study places paramount significance on exploring the feasibility of enhancing Iran's economic convergence with the Black Sea Economic Cooperation Organization (BSEC). Situated at the crossroads of Asia and Europe, and historically associated with the Silk Road, this organization was established in 1992. The primary aim of BSEC is to foster cooperation among its 13 founding member countries, namely Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, North Macedonia, Russia, Romania, Serbia, Turkey, and Ukraine. The overarching goal is to promote peace, stability, and prosperity within the Black Sea region. To date, the Islamic Republic of Iran has engaged with the aforementioned organization in the capacity of a Sectoral Dialogue Partner (SDP). Collaboration between Iran and BSEC has encompassed a wide spectrum of domains, including but not limited to transportation, agriculture and related industries, banking and finance, combatting organized crime, culture, customs affairs, education, emergency aid, energy, environmental protection, statistical data and information exchange, healthcare and the pharmaceutical industry, information and communication technologies, organizational rejuvenation and good governance, science and technology, small and medium industries, tourism, trade, and economic development. Furthermore, several specialized working groups have been established to facilitate and oversee these collaborative efforts.

THEORETICAL FRAMEWORK:

The theoretical framework underpinning research concerning economic convergence finds its roots in the theory of customs unions. Esteemed economists such as Viner (1950) and Meade (1955) have made significant contributions to the development of this theoretical domain. Advocates of the theory of economic convergence contend that it offers a pathway for less developed nations to harness the benefits of larger markets and to attain economies of scale, thereby mitigating the constraints imposed by the limited size of their domestic economies. Furthermore, proponents of the economic convergence theory posit that, through this approach, smaller nations can bolster their standing within the global economy and enhance their appeal for attracting foreign and international capital investments.

METHODOLOGY:

To fulfill the objectives of this research, data spanning the period from 2010 to 2021 was gathered from authoritative sources including the World Bank, the International Monetary Fund, and the International Trade Center. Subsequently, the collected data underwent analysis utilizing the gravity model, with the STATA software serving as the analytical tool. Notably, in the 1960s, seminal work conducted by Tinbergen and Poyhonen marked the early application of the gravity model for the examination of international trade flows. Since that time, the gravity model has evolved into a widely adopted tool in the realm of international economic studies. Numerous researchers have employed this model to explore trade dynamics between nations. It is worth emphasizing that the utility of the gravity model extends beyond the analysis of trade patterns; it is also instrumental in the examination of regionalism. In essence, this model functions as a versatile tool, capable of simulating potential trade relationships within any form of integration program involving groups of nations.

The results of the analysis have revealed that certain categories of goods, identified by their two-digit customs tariff codes, hold particular promise for the development of trade relations between Iran and the countries in question. These preferred groupings are as follows: "27: Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes," "72: Iron and steel," "39: Plastics and articles thereof," "29: Organic chemicals," "08: Edible fruit and nuts; peel of citrus fruit or melons," "74: Copper and articles thereof," "76: Aluminum and articles thereof," and "84: Machinery, mechanical appliances, nuclear reactors; parts thereof," in respective order. Moreover, the findings highlight that economic integration between Iran and the BSEC countries exerts a positive influence on the overall trade volume originating from Iran and destined for BSEC nations. Specifically, it is observed that a one-unit increase in economic integration between Iran and the BSEC countries leads to a corresponding 0.24 unit increase in the total trade volume between Iran and the countries within the BSEC framework. Consequently, it is deduced that fostering economic integration between Iran and the BSEC countries is a viable prospect, one that is poised to yield an upsurge in the volume of trade between Iran and the aforementioned countries.

 CONCLUSIONS & SUGGESTIONS:

Based on the research findings, it is recommended that policymakers take proactive measures to enhance economic convergence between Iran and the Black Sea Economic Cooperation Organization (BSEC) as a strategy to mitigate the impacts of economic sanctions. This recommendation is underscored by the strategic importance of the Black Sea region, given its unique position at the crossroads of Asia and Europe, historically associated with the Silk Road. However, it is essential to acknowledge that the Black Sea basin is one of the most heterogeneous and intricate regions globally. This geographic area encompasses countries that exhibit substantial political, economic, military, cultural, and religious diversity. Consequently, any collaborative endeavors between Iran and the member nations of the Black Sea Economic Cooperation (BSEC) should be structured and adapted to account for these multifaceted and dynamic conditions and components.

Among human resources, attention to demographic issues, especially the age structure of the population, is of particular importance in the economic growth and development of communities. If the necessary planning is done to face the changes in the age structure of the population in each country, it can provide the welfare of that country, but if these changes happen suddenly and without planning, it can cause serious damage to the economies of countries. The main purpose of the present study is to investigate the effect of population aging on inflation in two selected groups of developing and developed countries over the period 2001-2018 using panel data method. Empirical results show that in both groups of developing and developed countries, population aging has a negative and significant effect on inflation rate. Also, the growth of liquidity and the growth of production had a positive and negative effect on inflation in both groups of countries, respectively, which is in line with theoretical expectations. On the other hand, the results indicate that the increase in life expectancy in both groups of countries had a negative and significant effect on inflation in the study period.

In addition to the impact of traditional factors of production such as labor and capital on economic growth, the impact of productivity has always been the focus of growth and development economists. Given the fundamental role of the industry sector as a driver of the country's economic development, identifying the factors affecting the productivity of this sector can provide a basis for enhancing its share in GDP growth. Accordingly, the present study attempts to evaluate the impact of variable industry taxation on productivity of Iranian manufacturing industries during the Fifth Development Plan (2011-2015). An issue that is less certain for industry planners and researchers. In addition, this paper attempts to examine the relationship between variables such as investment in industry and compensation of payroll services (salaries and benefits) with total labor productivity. In this regard, the desired data were obtained from the statistical yearbook of the country and the results of the censuses of the country's manufacturing firms and the total labor productivity index was calculated by using the output data of ten firms and more. Then, the relationship between tax value and total labor productivity index is evaluated using integrated data panel (panel data) method. The results show that at the significant level of 5% of the coefficients of tax variables and compensation of wage earners has a positive and significant relationship with productivity and also the investment coefficient at the significant level of 10% has a positive effect on the dependent variable. In other words, with the increase in taxation, the productivity of the entire workforce has also increased, and manufacturing industries have sought to offset some of its costs by increasing productivity. But based on the coefficient of estimation, the severity of the impact of industrial productivity on tax is weak.

This research has examined the factors of non-realizing sustainable economic growth in terms of social capital in Iran's economy. For this purpose, at first, the provinces of the country were categorized into three regions, based on six individual trust-sensitive key economic variables (including Entrepreneurship, Level of Education , Employment, Per capita Real Production, Labour Productivity, and Female Labour Market Participation) ,by using the clustering and discriminant analysis methods. Then, the effect of five social capital variables (including Social, Economic, Immoral, Acute Social, and Family disorders) which reflect the lack of trust and consequently reduction of social capital, was estimated on each of the six economic variables, by using the panel data method in the years 2005-2017.The findings showed that the decrease in social capital, with high explanatory power, had a significant effect on economic performance and each of the six economic variables had been at least influenced by one of the mentioned disorders decreasingly. The two of variables, labour productivity and entrepreneurship, which are important factors in the sustainability of economic growth, have suffered the most negative impact. Also, the findings showed the synergistic effect of the reduction of social capital on economic performance in the next period. Therefore, the decrease in social capital with the effect on the key economic variables which are the most important qualitative and quantitative activities in economy, has caused the reduction of social efficiency in relations of the abundant production factors of Iran’s economy and as a result, non-realizing sustainable economic growth during the time.

Unemployment is a common but alarming phenomenon in our country's economy that brought about many social and economic problems. The paper attempts to investigate one of the economic harms caused by unemployment that has been less studied. It seems that not only unemployment affects the consumption of unemployed households, but it also affects employed households. in the way that unemployment, as a modifying factor of income expectations, affects household consumption. To study this issue, this article attempted to specify a formula for consumption based on economic theories and estimated its coefficients through using household income-expenditure data provided by the Statistical Center of Iran and employing panel data method. Results indicate that households, in the face of rising unemployment at the community level, reduce their consumption by 1. 5% in response to one percent increase in unemployment rate. Moreover, their share of food consumption increase while the share of nonfood expenditures tends to fall.
JEL Classification: D12، D82، J64، D84، C23

The objective of this research was to study the effect of information and communication technologies(ICT) on economic growth in member states of the D8. This research method was an analysis-causal and aimed at the application and fact and information about the variables used in this study was extracted from WDI2015. Also, Econometric tools used in research was Eviews Software and the econometric method is panel data and time domain is 2008 to 2014 and spatial domain including Iran, Indonesia, Bangladesh, Turkey, Pakistan, Malaysia, Egypt and Nigeria. The results of this research indicated that the coefficient for each of the variables in the model were consistent with the theoretical bases and statistically significant and information and communication technologies has a significant positive impact on economic growth.

The purpose of this study is to investigate the effect of intellectual capital on the cost stickiness of listed companies in the Tehran Stock Exchange (TSE). In this study, by reviewing cost stickiness theory, a complex pattern of asymmetric behavior of costs is rendered with emphasis on the role of the intellectual capital introduced by Pulic (2000). The research period is related to the span of 2005-2015. The statistical sample consists of 111 companies (1110 year-firm) listed on the TSE. The independent variable of this study includes intellectual capital and its’ components. The dependent variable encompasses selling, general and administrative costs. The intensity of staff, assets, reduction in revenue, and growth of the domestic production are considered as control variables. Panel data andmultiple linear regression analysis were used to test the research hypotheses. Data was analyzed by using panel data method. The results indicate a significant relationship and a pattern of the anti-stickiness between the intellectual capital and selling, general and administrative costs, for the components of the intellectual capital, a significant an anti-cost-stickness behavior persist, and the most effective component among the intellectual capital is related to the structural capital. Furthermore, the level of anti-cost-stickness in companies with a high intellectual capital is higher. The most significant effect among the components of the intellectual capital is related to the firms which maintain the higher coefficient of the efficiency in the human capital.

The vision of sustainability aims at justice in the domain of human-nature-relationships includes three specific relationships intergenerational justice, intragenerational justice and justice between humans and nature. Also, according to the new growth theories human is considered as one of the main factors affecting growth and economic development. There fore the goal of this study examined the impact of human development index on economic sustainability in the developed countries. For this purpose the human development index (HDI) and the new composite index and macro economic sustainability provide by the FEEM foundation according to the maximum amount of information available for the period 2007-2014 have been used. The results of the estimated model methods of panel data econometrics for developed countries, there is a nonlinear relationship and shows the threshold means that before the point of no return is negative and later positive relationship and therefore increasing the human development process in these countries becomes more sustainable economy.

The aim of this study is to investigate the relationship between government size and the unemployment rate based on Abrams curve. For this purpose, a number of developed and developing countries data during 2013-2000, using error correction model in panel data method is used. Long-term model results in both groups of countries shows a significant relationship between the size of government and unemployment rate. But this relationship is negative and significant in developing countries; this means that the decline in unemployment will require increasing the size of government. While in developed countries the size of government has a significant positive relation with the unemployment rate. This result confirms that the Abrams curve is true in developed countries. But in developing countries cannot be confirmed. The error correction model results show that in developing countries the imbalance modified 0.07 per period and unemployment rate will move towards equilibrium.

Corruption is defined as abuse of power by governmental and private officials for personal goals. Corruption is affecting by many variables, such as political, economic, cultural, geographical factor and will be influenced on many variables. The main goal of this article, is analyzing of effect of economic activity combination on corruption. In this article, 6 variables corruption, GDP per capita, oil rent, share of industrial value added in GDP and share of services value added in GDP are used. In this article, two models are estimated. First model is Bayesian model that is used for Iran. Second model is panel data model that is used for OPEC countries over the years 1995 to 2010. The conclusion have been obtained shows that oil rent and share of services value added in GDP variables have an positive effect on corruption and as they increase, corruption have been increased. The share of industrial value added in GDP and GDP per capita variables have an adverse effect on corruption and as they increase, corruption have been decreased. Also democracy has no significant effect on corruption.

Today, productivity is considered as a culture and prospect in all areas of human's work and life and is the source of progress and economic development. With regards to the progressing trend of globalization and the increase in membership of the countries in the WTO, the research investigates the effect of globalization and trade liberalization on productivity growth on two groups: 12 countries in the Middle East and North Africa (MENA) and 15 countries of the Europe :union:'s members (EU). Panel Data Method with Random effects is used study this relationship during the period of 2000-2013. The results show that globalization and trade liberalization have positive effects on improvement of productivity growth in both groups, but the coefficients for the Europe :union:'s members are greater than the MENA countries. In other words, increasing the degree of trade liberalization and globalization has had more effect on improvement of the productivity in Europe :union: countries than members of MENA.

Corruption defined as abuse of power by governmental officials for personal goals.in recent years, many articles about determinants of corruption have been written that introduced so many variables as determinants of corruption. These factors can be divided into two categories: economic and non-economic factors.in these article we examine the effect of economic activities combination on corruption.In order to define composition of the economic activities, we use two variables, the value added of the industrial sector in GDP and the value added of the services sector to GDP.in this paper we use 7 variables, including Corruption, Government Size, Democracy, GDP per capita, Inflation, The share of industrial sector value added in GDP and The share of Service sector value added in GDP.Panel data method is estimation method that used for 60 developing countries during 1995 to 2010. Our hypothesis in this research is that the economic activities combination is effective on corruption. The conclusion have been obtained shows that democracy and GDP per capita variables have an adverse effect on corruption and as they increase, corruption have been decreased. Increasing in the size government and inflation will also increase corruption. Finally increasing in the share of industrial in GDP will reduce corruption and also increasing in the service sector share in GDP will increase corruption.

The aim of this article is to investigate the effect of government effectiveness on reducing tax evasion in selected countries during the period 2000-2010. By using panel data econometric, tax evasion as a percent of GDP is used as a dependent variable and tax burden, tax morale, government effectiveness, GDP per capita, openness, the share of value added of industry and services in GDP and the ratio of urban population to total population are considered as independent variables. The results from estimated model suggest that the government effectiveness is the most important determinant of tax evasion in the selected countries. The results also indicate that the effects of GDP per capita, tax morale, openness and the relative share of industry and services sectors in GDP are negative and significant. Tax burden and urbanization have positive and significant effect on tax evasion.

Experts differ between inherited and acquired abilities, but only the latter differ among countries. Human capital analysis deals with acquired capabilities which are developed through formal and informal education at school and at home and through training, experience and mobility in labor market. Based on researches, human capital is the main transmission channel that affects economic growth in the presence of natural resources. It can improve economic growth through its main channels that are higher productivity and higher quality of labor force. The mechanism of this issue is that higher human capital accumulation, as an intangible capital, leads to more efficient use of produced and natural capital. Based on the facts, the intangible capital (such as human capital) makes up a large share of total wealth, an estimated 60-80 percent, in most countries. However, unless we understand more about the composition of intangible wealth, governments may be tempted to conclude that a wide range of public expenditures are somehow yielding intangible benefits. One of the key factors of intangible capital is education and it can help government doing its economic policies more successfully.

The financial structure is always considered as a major factor responsible for economic growth in a country. Based on various economic theories, there would be a positive relationship between the financial system and economic growth rate. In fact, a country with a better financial system can generate a larger Gross Domestic Product (GDP) which stands for a positive economic growth. However, it should be noted here that in the real world, there is not homogeneity in financial mechanism and economic growth, hence, we cannot completely set theory in the reality. According to this brief state of the problem, the main purpose of this research is exploring the financial structure (i.e. Financial development and financial architecture) – economic growth nexus through the Panel Cointegraiton approach, FMOLS and Panel LS estimations over 19802011 for eight countries in the MENA region. The empirical findings report clear support for the long run relationship between financial development and economic growth, while do not provide any statistically significant relationship between financial architecture and economic growth.

Education as a key tool for the creation of specialized labor is the most production inputs that have a significant role economic growth and development. Hence، the purpose of present study was to evaluate the impact of education، as a human capital index، on Iran''s economic growth. Therefore، needed data for country''s 30 provinces were collected from Iranian Statistics Center''s different publications during 2000-05. In order to predict a model، 2SLS method on panel data was performed and Moses Oketch recommended model equation were predicted by cross sectional method. Results indicated that focusing on education as one of the human capital indexes could have a positive effect on the country’s economic growth.

An empirical analysis is carried out establishing the existent relationship among the stock market (Beta) and (a) macroeconomic and (b) accounting informations. Regression analysis, using static and dynamic panel data estimations, is applied to a sample of 61 listed Iranian firms, between 2001and 2010. Systematic risk is estimated through OLS, EGARCH and M-GARCH models and use TEDPIX index (Tehran Stock Exchange Dividend & Price "total return" Index) as market portfolio.
The results show a connection between the systematic risk and the independent variables. The best models are found when we estimate the systematic risk using EGARCH model and applying a combination of macroeconomic and accounting variables. The most important variables explaining the systematic risk are Size (SZ), Growth Rate (GR) and Debt Ratio (DR) from accounting variables and Gross Domestic Product (GDPI),inflation (Change in CPI index), Legal interest rate (LINT), Oil price (Oilprice) and Exchange rate (EXCR). The results vary using different models and might be different if we use a different sample.

Oil price change is one of the most important economic factors that impacts oil importing and exporting countries، with the real exchange rate as the link between global oil price changes and national economies. These indices; crude oil prices and exchange rate and the relation among them; have crucial role for every country، especially those that are directly dependent to the import and export of oil. This survey investigates the way real oil prices affects real exchange rate in oil exporting and importing countries، using panel data for the period 1993 to 2009، to compare the two groups of countries. The findings show that the relationship between real oil prices and real exchange rates are significant in both groups of countries.

This study seeks to investigate the relationship between the development of financial sector and real sector in an economy under the asymmetric information because true growth is conditioned to the development of the financial structure, so that, countries with more developed financial sector, enjoy a higher rate of growth than the other countries. In this study the economic growth criterion denotes the development of the real sector, and variables such as ratio of the value of the stock exchange to GDP has been introduced as a criterion of development of financial sector. Also, logarithm of variance of the stock exchange price index and bank credits of the private sector index have been applied as a criterion of asymmetric information in the fiscal and money market. This model is estimated by applying panel data method for selected developed and developing countries in 1993-2008. The results depict the higher effectiveness level of financial market in comparison with money market in the developed countries, also financial structure of the developed countries differs from the developing ones because of a high level and evolved information symmetry in the developed countries, while in the developing countries, the money market is stronger than the stock exchange.