The effect of stock returns on the labor market demand in Iran

Investors in their decisions about their investments have paid attention to macroeconomic factors. This indicated that they intend to reduce their investment risk( systematic risk ) in terms of the expected returns are. The aim of this study was to evaluate the effect of stock returns on macroeconomic variables( demand for the labor market) in listed companies in Iran years 2006-2011 using dynamic pattern of labor demand (in order to consider the effects of labor market flexibility) and Limer test (to test the model using data combined with the fixed effects model) and data compilation methods (for the estimated model).
Accordingly, the main research question is whether stock returns over Iran will affect demand in the labor market? To answer the first question and then said market demand was estimated using panel data. In this study, to consider the effects of labor market flexibility and dynamic labor demand model is used. The results have shown that the positive relationship between stock returns and there is a significant demand in the labor market. Thus, capital market development to create jobs in the labor market, although the coefficient obtained in the model suggest that this impact is negligible compared to the level of unemployment.