Investigating the Effects of Institutional-Structural Quality on Iran's Non-oil Exports: Time-varying Models

The development of non-oil exports as a factor in crossing the oil economy and utilizating unused capacities of the country's economy, such as active labor force, is always a matter for the policy makers of the country. The requirements for expansion of non-oil exports are identificating effective factors on it, and understanding of how they are effective on non-oil exports of the country. In this paper, using the factor-augmented vector autoregressive (FAVAR) model with time-varying parameters (TVP) and seasonal data through 1376 to 1394, the nonlinear effects of real exchange rate variables, the value added of the industry and mining sector Non-oil exports and the hidden factor, the structural institutional quality which is consists of six indicators, on non-oil exports of Iran has been modeled. The results denote the positive symmetric effects of the structural institutional quality and the non-oil exports on increasing non-oil exports, so that this positive affects have been increasing over time. Based on the results, the final effect of the real exchange rate on non-oil exports of the country depends on the conditions of the depression and prosperity of the economy and can be asymmetrically positive or negative. Finally, the effect of the growth of the country's value added on non-oil exports is positive in all period studied, with the difference that these symmetric effects are more during periods of economic prosperity and less during the recession periods.