The Empirical Analysis of Effective Factors on Budget Deficit in Iran Using Fuzzy Dematel Method

The government budget deficit in Iran has increased over the years and has been become to a chronic problem. Now that persistent budget deficit has adverse effects such as economic and political instability, it is necessary to identify the reasons budget deficit. This paper examines the effective factors on the budget deficit in Iran using data extracted from the field study in 1398 and using the fuzzy dematel method. The results of research shows that firstly, the budget deficit is a multidimensional issue that various economic and institutional factors affect its formation and growth. Secondly, the fiscal, monetary and exchange rate policies performance, as well as some institutional factors such as inefficiency in the budgeting process and budget allocation stages and economic corruption are identified as the most important causes of budget deficit. Thirdly, among the different factors, economic corruption has the third rank in creating budget deficit. This factor is affected by the weakness in enforcement and rule of law, low quality of government and monitoring systems witch as a result grows rent seeking behavior in the budgeting and ultimately imposes useless spending and strengthen the likelihoode of budget deficit.                                                                                                                      .