Effect of Political Instability on Economic Growth in Iran (Nonlinearity method, APARCH)

According to the political economy literature، a country''s political and economic structures have close، and also complex relationship with each other. Therefore political structure of the country is known to be the leader system of economic management that reflects regime''s economic ideologies. Hence any disorder in the political system، especially in developing countries، could lead to economic instability and disrupts normal flow of the economy which will result in slower economic growth as the most important indicator of economic performance. This study tries to analyze effect of political instability on Iran''s economic growth by using political and social Time Series data during period 1339-1388. For this purpose، effect of political instability on economic growth based on formal political instability and informal political instability indexes has been tested by using APARCH technique. Empirical findings of this study indicate that variables related to the both mentioned indexes have a negative effect on economic growth