Iranian Economic Review
Volume:29 Issue: 78, Winter 2025

In recent times, studies on the nexus between carbon emissions and financial development have become plentiful. Very few of them consider the nonlinearity or asymmetry of the relationship between financial development indices and CO2 emissions. The objective of this study is to explore asymmetric cointegration within the framework of the non-linear autoregressive distributed lag model on the emissions-financial development nexus using Nigeria’s data from 1981 to 2020. Our findings revealed the existence of an asymmetric long-run relationship between CO2 emissions and financial development measured by credit to the private sector, financial deepening, and market capitalization. Positive shocks to Credit to private sectors have a negative and significant impact on the emission at 1% level, while negative shock is not statistically significant in explaining emission in Nigeria. Positive shocks of market capitalization insignificantly reduce emissions and vice versa. Moreover, asymmetric shocks of financial deepening have negative and significant effects on emissions in Nigeria. The study therefore recommends that domestic credits to the private sector should be geared towards enhancing renewable energy, as more investments are required especially in solar and wind energy. In addition, environmental laws be strengthened and pollution taxes be introduced to mitigate the increasing level of CO2 released through the consumption spree for energy-demanding and CO2-emitting goods aided by the increasing level of Nigeria’s financial development.

Immigration is one of the factors affecting macroeconomic variables, including foreign trade. Considering the large number of Afghan migrants throughout the world, this study sought to investigate the effect of Afghan migrants on the imports and exports of this country during 2001-2019, using the semiparametric augmented gravity model for the empirical purpose of the study. The results of the semiparametric estimation of the fixed effects model have indicated that the role of emigration on the volume of exports and imports of Afghanistan has a non-parametric effect. That is, on some levels of emigration, the increase in the number of immigrants abroad has increased trade and confirms the existence of a complementary relationship between labor migration and trade, contrary to the theory of Heckscher-Ohlin, but at other levels, the accumulation of immigrants has caused a decrease in the volume of Afghanistan's imports and exports. This result is consistent with Heckscher-Ohlin 's theory. Of course, it can be due to the integration of immigrants in the host society and the disconnection with the destination countries, the difference in skills level and information of immigrants.

This study specifically investigates the direct effect of financial development and remittances as well as the interaction effect of remittances and financial development (FD) on poverty reduction in various income groups in sub-Saharan Africa. The study employed the Panel ARDL model on data from 31 sub-Saharan countries during the period 1990-2020. The study found that in the long run, both remittances and FD contribute to poverty reduction in sub-Saharan Africa, middle-income, and low-income groups within the region. The study also found that the interaction of remittances and FD does not contribute to the poverty alleviation process. In the short run, both remittances and FD fail to enhance poverty reduction in the region and among the income groups. Likewise, the interaction between remittances and FD does not contribute to poverty reduction in the region and within the income groups. The study found that the levels of income play no role in the relationship between remittances, financial development, and poverty reduction but it has little effect in the short-run. There is a need to make financial institutions more efficient in promoting the inflow of remittances through the formal channel by easing and reducing the cost of the transaction of remittances.

This research investigated the direct and indirect effects of an investment in tourism sub-sectors in Razavi Khorasan Province on the value added of other economic sectors of Razavi Khorasan Province and other provinces by the input-output approach. Therefore, the FLQ-RAS method was developed to prepare the two-region input-output table of Razavi Khorasan Province and other national economies based on the input-output table of 2016. We used a non-statistical method to prepare the input-output coefficients and the two-region model. The results indicate that the simultaneous increase of 700 billion riyals in tourism-related sectors in the Razavi Khorasan province directly affects wholesale and retail activities, other ground transportation, and governmental human health activities. Also, in terms of increasing investment in every tourism activity, government human health creates the most significant overall effect compared to other activities, wholesale and retail activities, as well as administrative activities, and support services, have the second and third ranks of influence from the increase in investment. Also, the actions of government human health, Accommodation and Wholesale, and retail, except motor vehicles and motorcycles have experienced the most direct effects from investment.

This study aimed to measure Non-Performing Financing (NPF) factors through Gross Regional Domestic Product (GRDP), unemployment rate, office network, consumptive financing, and COVID-19 cases. Cross-section data in 34 Indonesian provinces were analyzed using Geographically Weighted Regression (GWR) through global regression confirmation. The results showed differences between the GWR and global regression. All exogenous variables have spatial variability to endogenous variables. This resulted in variations in local models influencing NPF, including in DKI Jakarta, West Java, Central Java, DI Yogyakarta, East Java, Bali, and West Nusa Tenggara Provinces. Additionally, this study has implications for bankers in mitigating credit risk by maintaining the adequacy ratio of funds and tightening the verification of prospective debtors. Bankers should also restructure financing, monitor portfolio performance, and build digital infrastructure in each regional office by considering the dynamics in the provinces. In addition, the province's representative of the Financial Services Authority and Central Bank offices must coordinate directly supervising Islamic banks in the region.

Islamic Business is a business activity related to Islamic principles. This study explores the development of research on Islamic business from 1985 to 2022. This study uses a comprehensive bibliometric analysis approach that combines bibliometrics and content analysis (Hybrid Approach) to analyze current Islamic business research trends. Data is collected through the Scopus database with the keywords “Islamic Business” OR “Business”. The initial data search discovers 2,066 documents and is screened according to the search topic. After the selection stage, there are 232 documents that are analyzed using R Biblioshiny software and Vosviewer. This research produces an analysis of authors, countries, institutions, subject areas, and trends on topics that influence future research. In the content analysis stage, 232 articles were classified into four sub-topics, namely: 1- Islamic business technology (30 articles), 2- Islamic banking industry (75 articles), 3- Islamic business management (77 articles), and 4- business ethics and halal-haram (50 articles). There are several keywords that rarely appear as potential topics to be researched, such as the following keywords, Shariah governance (2), macroeconomic variables (2), logistics (1), Islamic insurance (1), Ijarah (1), Islamic stock portfolio (1), and Uganda (1).

With all the technological advancements over the world, a great interest is on its effect on jobs. Technological change takes away or creates more jobs for human? This debate has been going on for a long time and still ongoing in different countries. The limited studies on the topic in low and middle incomes countries gives us the opportunity to study a subject that have not yet been sufficiently addressed, specially that technology is changing work in these countries day by day as it was demonstrated in the covid19 pandemic. To be more objective in presenting the research finding we used a literature review based on the meta-analysis method. We tried to synthesize and summarize the results of 19 studies by using a quantitative method that allowed us to report 531 estimations. Three reference models were distinguished: Derived labor demand model (DDM) developed by Van Reenen (1997), skill share model (SSM) created by Machin and van Reenen (1998) and the most recent: innovation decomposition model (IDM) used by Harisson et al. (2014). The review found that the effect of technology varies depending on the type of innovation, for process innovation work can be more efficient and less time-consuming for skilled workers although unskilled workers are more likely to be replaced by automated processes. For product innovation the effect is positive on total employment, we may consequently state the validity of Skill biased technological change hypotheses (SBTC) for low- and middle-income countries. However, the presence of publication bias and heterogeneity limits the generalizability of these results.

Income inequality has been so much evident in the last four decades as the rich are accumulating more wealth than the poor leading to changes in output, consumption, and employment. However, the concern in recent times of digitalized economies has been its effects on macroeconomic activities through the aggregate demand channel. This study examines the impact of income inequality on aggregate demand in Nigeria, the study data were gathered from the World Bank from 1985 to 2020. The study incorporates infant mortality rate and life expectancy as control variables while the Dynamic Ordinary Least Square (DOLS) was adopted as the method of estimation. The study's descriptive analysis shows that the variables are integrated at I(0) and I(1) while the DOLS result shows that income inequality, inflation, and life expectancy have a negative impact and significant relationship on aggregate demand. The study results also show a long-run relationship among the variables and it was thus concluded that increasing income inequality in Nigeria is detrimental to aggregate demand. The study recommends that government should increase its spending on social services, ensure direct transfer services to the poor and target fiscal and monetary policies that are inequality reduction driven.

In this study, we assess the degree of Tunisian households’ dependence on migratory remittances during the first wave of the COVID-19 crisis and how much this dependence intersects with economic vulnerability in Tunisia. For this objective, we identify three variables needed for our analysis that reflect remittance dependency, economic vulnerability, and infrastructure inadequacy. Using data from wave eight of the Afrobarometer Household Survey, conducted in 2020, we estimated a multinomial logistic model. The findings show that a significant probability of the most economically vulnerable Tunisians is considered highly dependent on international remittances. Also, we are finding a likelihood of increased receipt of funds through official channels during the lockdown. However, Tunisians dependent on remittances face more economic shortages which are further exacerbated when they intersect with the infrastructure deficit and fewer digital resources. These households will therefore be less able to adapt to a restriction on in-person remittance services during a lockdown to contain the COVID-19 virus. As a result, the paradigm shift from cash to digital money is necessary.

Women who are heads of households are often trapped in poverty and are in quite vulnerable conditions. They have to carry out a dual role: taking care of the household and at the same time earning a living for their family. Uncovering and understanding their life can help find the best way to improve their life. This study uses a descriptive-qualitative analysis approach by combining secondary and primary data analysis. All research activities focus on the conditions and situations faced by poor female heads of households in Gorontalo Province, Indonesia. This study found that the combination of old age, uneducated, unskilled, and unemployed is the main factor causing poverty in poor female heads of households. Basic public services and economic resources, which are unable to reach all poor households, have contributed to exacerbating poverty conditions. Therefore, to improve the standard of living of women headed poor households, interventions are needed that combine social assistance and protection (such as provision of cash, food assistance, health insurance, etc.), provision of skills, equipment assistance, business capital assistance (especially for trading businesses), access to micro-credit, and assistance, while improving their housing conditions, especially housing, sanitation, and clean water.

The evidence shows that the lack of comprehensive trade policies in Iran's agricultural sector has caused the growth of this sector to be unstable and limited to a few countries. Experts and economists also claim that Iran's capacity to achieve higher export figures and expansion of target markets is higher. Therefore, this paper aims to quantify the export capacity of Iranian agricultural products to trading partners using a stochastic frontier gravity model during 1997-2021. The results indicated that Iran has the export efficiency above 50% with only six countries including Germany, Russia, Vietnam, Spain, India, and the UAE, which represent the high capacity of Iran's export potential in many trading partners in agricultural products. In addition, except for Russia and the UAE, other neighboring countries have a high potential for accepting agricultural products. On the other hand, regarding the estimation of the average export potential and its gap from the actual export based on the estimated stochastic frontier gravity model, the results indicated that the highest potential agricultural exports are related to Turkey, Egypt, Libya, Croatia, and Uzbekistan, respectively. The export gap is negative for all trading partners, which indicates that Iran has agricultural exports less than the maximum possible limit to all trading countries. The results confirmed that economic size and geographical distances have a positive and negative effect on Iran's agricultural exports, respectively.

This paper investigated the impact of four different indicators of political institutions on the quality of economic institutions across the different Sub-regions (Central, East, South and West Africa) in Sub-Sahara Africa (SSA). A panel data of 43 countries in SSA over the period 1996 to 2020 was gathered and analyzed. Im-Pesaran-Smith (IPS) panel unit root test technique is used to evaluate the stationarity property of the variables. Then, three alternative long-run panel cointegration regression techniques, namely; mean group (MG), pooled mean group (PMG) and dynamic fixed effects (DFE) are used to gauge the specified model. The most efficient among them is chosen using Hausman specification test. The findings from the empirical analysis are in three folds: i. political institutions do not have short-run impact on economic institutions in SSA as a whole and across the four sub-regions; ii. political institutions do have long-run influence on the quality of economic institutions, with rule of law having the biggest impact, follow by government effectiveness, political stability and quality of democracy in that order; iii. The impact of political institutions on economic institutions is not similar across the four sub-regions in SSA. Unlike previous studies, this paper identifies specific type of political institutions relevant in improving the quality of economic institution in each sub-region of SSA. The finding establishes inter alia that one size fit not all hypothesis is applicable across the sub-regions in SSA.

This paper examines the effect of labor market regulations (LMR) on the unemployment rate for 17 oil-producing countries from 2000 to 2019. The panel corrected standard errors (PCSE), and the panel autoregressive distributed lag (ARDL) estimators are employed in this regard. The negative effect of output growth on the unemployment rate was confirmed. This study shows that a more flexible or less protective labor market in oil-producing countries is generally associated with higher unemployment rates. This result was confirmed in the static PCSE estimation. However, both results indicated that increased GDP growth in more flexible labor regulations is associated with higher unemployment rates. These findings suggest that there is a need for more empirical evidence according to the hypothesis that higher labor market flexibility leads to decreases in the unemployment rate. Therefore, the implementation of labor market regulations, whether more flexible or more rigid regulations are needed, should be under consideration of the overall economic conditions.

Scarce water resources often involve decision-makers with conflicting interests. Effective management requires balancing objectives and strategies of multiple stakeholders. The present study analyzes the potential compromise solutions between stakeholders, using a combination of game theory and a positive mathematical programming (PMP) model. The two key players are the government, which minimizes environmental impacts such as groundwater withdrawal, and local farmers, who maximize economic profit. We employ four conflict resolution methods to calculate the players’ payoffs. The results show that creating a transactional relationship between the stakeholders reduces groundwater extraction by 36% and 37%, while the farmers' net income only drops by 8% and 9%, respectively, compared to the baseline scenario.

Iran’s below-average life insurance penetration rate relative to the global average, is caused by several factors. Sellers’ behavior and motivations can be one of these factors. Given that the distorted prices divert the resources, the imbalanced sales commission rate could generate a conflict of interest among the players in life insurance market. Universal life insurance has a substantially higher commission rate than other types. Therefore, it can incentivize sellers to offer more universal life insurance than term life insurance, regardless of customers’ needs. In this paper, we postulate that the existing sales commission system in the Iranian life insurance industry may deviate customer demand and raise the likelihood of policy surrendering. This issue is a principal-agent problem for insurer and seller, and supplier-induced demand (SID) for seller and customer. In the form of signaling games, these conflicts of interests among the players has been analyzed using descriptive-analytical method based on game theory. We observed that if the seller has the same desire to sell different types of life insurance, there is a greater likelihood that they will provide genuine advice to the customer. By reducing the surrender rate, the situation can be improved.