Central Bank Of Iran Research Articles

Weather or not? The role of international sanctions and climate on food prices in Iran

IntroductionThe scarcity of resources have affected food production, which has challenged the ability of Iran to provide adequate food for the population. Iterative and mounting sanctions on Iran by the international community have seriously eroded Iran's access to agricultural technology and resources to support a growing population. Limited moisture availability also affects Iran's agricultural production. The aim of this study was to analyze the influence of inflation, international sanctions, weather disturbances, and domestic crop production on the price of rice, wheat and lentils from 2010 to 2021 in Iran.MethodData were obtained from the statistical yearbooks of the Ministry of Agriculture in Iran, Statistical Center of Iran, and the Central Bank of Iran. We analyzed econometric measures of food prices, including CPI, food inflation, subsidy reform plan and sanctions to estimate economic relationships. After deflating the food prices through CPI and detrending the time series to resolve the non-linear issue, we used monthly Climate Hazards group Infrared Precipitation with Stations (CHIRPS) precipitation data to analyze the influence of weather disturbances on food prices.Results and discussionThe price of goods not only provides an important indicator of the balance between agricultural production and market demand, but also has strong impacts on food affordability and food security. This novel study used a combination of economic and climate factors to analyze the food prices in Iran. Our statistical modeling framework found that the monthly precipitation on domestic food prices, and ultimately food access, in the country is much less important than the international sanctions, lowering Iran's productive capability and negatively impacting its food security.

Legal regulation of the currency exchange market in Iran: a Hayekian analysis

ABSTRACT Hayek contends that good money is not available when the central bank is under political pressure, and the government dictates its decisions. As an illustration, the Central Bank of Iran, in accordance with the government’s concern, has actively interfered in the currency market to maintain the value of the money. This attempt was weakened by the U.S. sanctions. In another vein, legislators modified Combatting the Smuggling of Commodities and Foreign Exchange Law to tighten the freedom of currency exchange. The law imposes severe penalties on those who keep, carry, and sell currencies that do not fall within the definition of legal currency exchange. This paper contends that although such measures might temporarily suppress demands, they are unlikely to make a controllable currency market. Based on Hayek’s theory of money, the government’s budget deficit and unrestrained printing of money have also exacerbated the situation that promotes bad money.

How do Islamic banks manage earnings? Application of various measurement models in the Iranian Islamic banking system

PurposeThis study aims to identify and compare the measurement models of earnings management (EM) appropriate to the Iranian Islamic banking system. The importance of reported profit figures has motivated business executives, who also perform financial reporting, to manipulate these figures. These measures are referred to as “earnings management,” which negatively influence the quality of reported earnings and financial statements' reliability.Design/methodology/approachIn this study, four methods, namely, Jones (1991), modified Jones (Dechow et al., 1995), Kasznik (1999) and Kothari et al. (2005), were used to measure the EM index in 25 Iranian Islamic banks (IBs) registered with the Tehran Stock Exchange and/or the Central Bank of Iran. The study covered the period 2005–2020. Following the aforementioned methods, this research implemented templates that were repeatedly tested in subsequent studies using accruals to discover EM.FindingsThe results show that the Kasznik (1999) model is the preferred and compatible model with the Iranian Islamic banking system's accrual behaviour due to the consistency of the measurement coefficients with theoretical and previous research findings. Therefore, total accruals, including discretionary accruals and non-discretionary accruals, have the most correspondence with (1) property, machinery and equipment; (2) the change in cash flow from operating activities; and (3) the difference of change in revenue (ΔREV) and change in net receivable accounts (ΔREC).Originality/valueThis is the first investigation in the Iranian Islamic banking system. The research contributes to the Iranian Islamic banking system literature on the implements of EM, which could be appealed to in the context of developing countries like Iran. Finally, this study highlights the different EM capabilities in Islamic banking systems similar to the Iranian banking arrangement.

The effect of financial repression policy on bank liquidity risk (evidence from Central Bank of Iran)

The effect of financial repression policy on bank liquidity risk (evidence from Central Bank of Iran)

The economic burden of esophageal cancer in Iran.

Studies on economic burden demonstrate the impacts of some diseases and provide invaluable information for specifying priorities and resource needs when designing cancer control strategies. The current study aimed to estimate the cost of esophageal carcinoma (EC) in Iran in 2018. This study was conducted on the prevalence approach to estimate the economic burden of EC in Iran from a social perspective. The direct cost was estimated by summing the diagnosis, treatment, follow-up, terminal care, and transport costs. Additionally, a human capital approach was adopted to estimate productivity losses. Various resources were used for data collection, including the GLOBOCAN 2018 report, and the medical record in the Cancer Institute of Iran. Also, data such as exchange rates, employment, and housekeeping rates were extracted from the Central Bank of Iran Statistics. The economic burden of EC in Iran was $69.2 million in 2018, of which $38.7 million is caused by indirect costs and $30.5 million by direct costs. The mortality cost accounted for 49% of the economic burden, followed by 34% direct medical cost, 10% direct non-medical cost, and 7% morbidity cost. Mortality and medical cost appeared to be the main contributor to the economic burden. Therefore, policy-makers are recommended to adopt early detection and effective treatment as a highly cost-effective strategy for controlling costs.

The effect of financial repression policy on bank liquidity risk (evidence from Central Bank of Iran)

The effect of financial repression policy on bank liquidity risk (evidence from Central Bank of Iran)

Identifying the Main Factors of Iran’s Economic Growth Using Growth Accounting Framework

This paper aims to present empirical analysis of Iranian economic growth from 1950 to 2018 using data from the World Bank, Madison Data Bank, Statistical Center of Iran, and Central Bank of Iran. The results show that Gross Domestic Product (GDP) per capital increased by 2 percent annually during this time, however this indicator has had a huge fluctuation over time. In addition, the economic growth of Iran and oil revenue have close relationship with each other. In fact, whenever oil crises happen, great fluctuation in growth rate and other indicators happened subsequently. Even though the shares of other sectors like industry and services in GDP have increased over time, the oil sector still plays a key role in the economic growth of Iran. Moreover, growth accounting analysis shows contribution of capital plays a significant role in economic growth of Iran. Furthermore, based on growth accounting framework the steady state of effective capital is 4.27 for Iran’s economy.

Reviewer Acknowledgements

Applied Finance and Accounting [AFA] would like to acknowledge the following reviewers for their assistance with peer review of manuscripts for this issue. Many authors, regardless of whether AFA publishes their work, appreciate the helpful feedback provided by the reviewers. Their comments and suggestions were of great help to the authors in improving the quality of their papers. Each of the reviewers listed below returned at least one review for this issue.Reviewers for Volume 7, Number 2Adina Criste, “Victor Slavescu” Centre for Financial and Monetary Research, Romanian Academy, RomaniaAnastasia Kopaneli, University of Patras, GreeceDapeng Zhu, Shanghai Lixin University of Accounting and Finance, ChinaFabio Rizzato, University of Turin, ItalyHaitham Nobanee, Abu Dhabi University, UAEHajar Jahangard, Central Bank of Iran(CBI), IranHassan Rkein, Al Maaref University , LebanonJayendra S. Gokhale, Embry-Riddle Aeronautical University, USAMawih Kareem Alani, Dhofar University, OmanVolodymyr Vysochansky, Uzhhorod National University, UkraineZi-Yi Guo, Wells Fargo Bank, N.A., USA Angelia EvelynEditorial AssistantOn behalf of,The Editorial Board of Applied Finance and AccountingRedfame Publishing9450 SW Gemini Dr. #99416Beaverton, OR 97008, USAURL: http://afa.redfame.com

Demographic changes and savings behavior: the experience of a developing country

PurposeThis paper aims to disclose the savings behavior of Iran's economy in the context of demographic transition.Design/methodology/approachEmploying a version of Ramsey-Cass-Koopmans growth model, this paper benefits from a broad range of data and variables which are mainly taken from the Central Bank of Iran's database. The study uses actual and calculated data to produce analogous simulated data. The data cover the 1970–2015 period. This long period provides an opportunity to simulate more valid time series. It is worth noting that due to the severe economic sanctions imposed on the Iran's economy, particularly after 2017, some most recent data have been obliterated from the sample.FindingsThe results, stemming from the simulated model, hint that; firstly, the population variable is a notable determinant of the savings rate. Secondly, the effects of a slump in the population growth rate would attenuate the savings level significantly. Thirdly, other pragmatic steps could be taken to redress the fallout of the demographic changes.Research limitations/implicationsThere are some limitations in providing broad data related to economic sectors in Iran. The savings data, for instance, are available as an aggregated time series, and if the authors had wide data of household level, they would have been able to build more detail-based model. Similar to this issue of lack of households’ income-based data, some measures such as high or low levels as well as detailed demographic data could be helpful in sophisticated household level resulting. In addition, the complex relationship between the government and social security (pension) funds, in terms of financing part of government's budget deficit by these funds, thwarts a typical researcher in using comprehensive and transparent government expenditure data in their research. In other words, the possible positive or negative role of the funds, as a related issue to the demographic changes, cannot simply be determined in the model. It might be possible after necessary corrections are carried out in the mentioned relations.Originality/valueIn fact, the problem statement in this paper is to discern how the population aging can impact the saving rates on the one hand, and to what extent its repercussion can be modified by the other theoretical-based determinants on the other. In fact, the underlying argument of the present research arises from the stylized facts concerning prognosticates of the future evolutions of the world's population. To that end, the study will use Iran's economic and demographic data.

SANKSİYALAR DÖVRÜNDƏ İRANIN NEFT-QAZ SƏNAYESİ

Followed by the victory of the Islamic Revolution in Iran the aggravated conflict between Tehran and USA has been observed. These interrelations have resulted in USA imposing sanctions on Iran. Sanctions have lasted since 1979 and have decelerated Iran's economic growth. With the accession of the United Nations, Resolution 461 was adopted, comprising economic sanctions against Iran. The sanctions principally targeted investments in oil, gas and petrochemicals, exports of refined petroleum products, and business collaborations with Iranian Revolutionary Guard companies.Afterwards, banking and insurance operations, shipping, and Internet services have become to be included, especially the Central Bank of Iran. Key words: Islamic Revolution in Iran, Central Bank of Iran, Tehran, USA, Iran

Reviewer Acknowledgements

Applied Finance and Accounting [AFA] would like to acknowledge the following reviewers for their assistance with peer review of manuscripts for this issue. Many authors, regardless of whether AFA publishes their work, appreciate the helpful feedback provided by the reviewers. Their comments and suggestions were of great help to the authors in improving the quality of their papers. Each of the reviewers listed below returned at least one review for this issue.Reviewers for Volume 7, Number 1Aderaw Gashayie Ayaliew, Higher institution, EthiopiaAnastasia Kopaneli, University of Patras, GreeceAndrey Kudryavtsev, The Max Stern Yezreel Valley Academic College, IsraelFahri ÖZSUNGUR, Adana Science and Technology University, TurkeyGheorghe Morosan, Stefan Cel Mare University Suceava Romania, RomaniaHaitham Nobanee, Abu Dhabi University, UAEHajar Jahangard , Central Bank of Iran(CBI), IranJayendra S. Gokhale, Embry-Riddle Aeronautical University, USAMarco Muscettola, Independent researcher, ItalyMawih Kareem Alani, Dhofar University, OmanShahram Fattahi, Razi University,, IranYu Peng Lin, University of Detroit Mercy, USA Angelia EvelynEditorial AssistantOn behalf of,The Editorial Board of Applied Finance and AccountingRedfame Publishing9450 SW Gemini Dr. #99416Beaverton, OR 97008, USAURL: http://afa.redfame.com

Effect of Ink and Pretreatment Conditions on Bioethanol and Biomethane Yields from Waste Banknote Paper.

Waste banknote paper is a residue from the banking industry that cannot be recycled due to the presence of ink, microbial load and special coating that provides protection against humidity. As a result, waste banknote paper ends up being burned or buried, which brings environmental impacts, mainly caused by the presence of heavy metals in its composition. To minimize the environmental impacts that come from the disposal of waste banknote paper, this study proposes to produce value-added products (bioethanol and biogas) from waste banknote paper. For this, the effect of ink and pretreatment conditions on bioethanol and biomethane yields were analyzed. Waste banknote paper provided by the Central Bank of Iran was used. The raw material with ink (WPB) and without ink (WPD) was pretreated using sulfuric acid at different concentrations (1%, 2%, 3%, and 4%) and the nitrogen explosive decompression (NED) at different temperatures (150 °C, 170 °C, 190 °C, and 200 °C). The results show that the use of NED pretreatment in WPD resulted in the highest glucose concentration of all studies (13 ± 0.19 g/L). The acid pretreatment for WPB showed a correlation with the acid concentration. The highest ethanol concentration was obtained from the fermentation using WPD pretreated with NED (6.36 ± 0.72 g/L). The maximum methane yields varied between 136 ± 5 mol/kg TS (2% acid WPB) and 294 ± 4 mol/kg TS (3% acid WPD). Our results show that the presence of ink reduces bioethanol and biogas yields and that the chemical-free NED pretreatment is more advantageous for bioethanol and biogas production than the acid pretreatment method. Waste banknote paper without ink is a suitable feedstock for sustainable biorefinery processes.

Economic burden of cardiovascular diseases before and after Iran\u2019s health transformation plan: evidence from a referral hospital of Iran

BackgroundDifferent countries have set different policies to control and decrease the costs of cardiovascular diseases (CVDs). Iran was aiming to reduce the economic burden of different disease by a recent reform from named as health transformation plan (HTP). This study aimed to examine the economic burden of CVDs before and after of HTP.MethodsThis cross-sectional study was conducted on 600 patients with CVDs, who were randomly selected from a specialized cardiovascular hospital in the north-west of Iran. Direct and indirect costs of CVDs were calculated using the cost of illness and human capital approaches. Data were collected using a researcher-made checklist obtained from several sources including structured interviews, the Statistical Center of Iran, Iran’s Ministry of Cooperatives, Labor, and Social Welfare, the central bank of Iran, and the data of global burden of disease obtained from the Institute for Health Metrics and Evaluation to estimate direct and mortality costs. All costs were calculated in Iranian Rials (IRR).ResultsTotal costs of CVDs were about 5571 and 6700 billion IRR before and after the HTP, respectively. More than 62% of the total costs of CVDs accounted for premature death before (64.89%) and after (62.01%) the HTP. The total hospitalization costs of CVDs was significantly increased after the HTP (p = 0.038). In both times, surgical services and visiting had the highest and lowest share of hospitalization costs, respectively. The OOP expenditure decreased significantly and reached from 54.2 to 36.7%. All hospitalization costs, except patients’ OOP expenditure, were significantly increased after the HTP about 1.3 times. Direct non-medical costs reached from 2.4 to 3.3 billion before and after the HTP, respectively.ConclusionEconomic burden of CVDs increased in the north-west of Iran after the HTP due to the increase of all direct and indirect costs, except the OOP expenditure. Non-allocation of defined resources, which coincided with the international and national political and economic challenges in Iran, led to unsustainable resources of the HTP. So, no results of this study can be attributed solely to the HTP. Therefore, more detailed studies should be carried out on the reasons for the significant increase in CVDs costs in the region.

Benevolent savings and macroeconomic variables: some empirical evidence from Iran

ABSTRACT Many studies have investigated the impact of savings on macroeconomic variables. However, there is no study on the effect of benevolent saving on macroeconomic variables. In benevolent saving/lending, households save part of their income for lending benevolently at zero interest rates to the needy population. This study applies the Toda-Yamamoto causality test on a novel quarterly time-series data provided by the Central Bank of Iran from 1988 to 2015 to test the relationship between benevolent savings and a few macroeconomic variables. The results show that benevolent savings have short-run positive effects on total consumption and total investment.

Monitoring Process Mean Using a Second Order Filter: Signal and System Approach

In statistical process control one objective is to control the stability of a process. A process is stable when its mean is in control and variance bounded. Different control charts were introduced for monitoring the mean and variance of a process by plotting suitable test statistics on the chart. In this research design of a system which converts the sample mean to a test statistics was proposed. The second order filter, a special class of the Linear Time Invariant (LTI) systems, was used to design the converting system. It was shown that design of a low pass filter was better for detecting a level (mean) change in the process. Markov chain approach was also followed to construct appropriate control chart and to estimate its control limits. Simulated data under normality assumption for different scenarios were used to compare the proposed control chart with Shewhart and Exponentially Weighted Moving Average charts by means of ARL and PFS criteria. Existing data from the Central Bank of Iran was also applied to evaluate the suggested method. The signal to noise ratio was used to assess the performance of this method at different stages. Results indicate that the proposed method detects shifts more rapidly.

Fossil energy price and outdoor air pollution: predictions from a QUAIDS model

Cheap fossil energy leads to overconsumption of energy and hazardous levels of air pollution. In this study, we provide a framework to connect fossil energy price policy to private consumption of energy and outdoor air pollution. We used a consumer demand system and reassessed it for the recent status of the Iranian economy. We extracted household consumption information from Iran’s 2011 and 2014−2016 annual household surveys (n=154683), prices from the Central Bank of Iran’s detailed monthly price indices from 2008 to 2016, and air pollution information from Iran’s Energy Balance Sheets. We estimated that an average Iranian household would reduce its energy consumption by 2%, 16%, 29%, 38%, and 45% if energy prices were hiked by 10%, 50%, 100%, 150%, and 200%, respectively. The corresponding reductions in total outdoor air pollution in the post-hike period would be 2.6, 26.3, 47.6, 62.9, and 74.5 million tons, respectively. Besides highlighting the importance of fossil energy price policy as a short-term strategy to reduce air pollution, this study calls attention to shifting the existing subsidies on fossil fuels to sustainable sources of energy such as waste-oriented biofuels as a -long-term solution.

Reviewer Acknowledgements

Applied Finance and Accounting [AFA] would like to acknowledge the following reviewers for their assistance with peer review of manuscripts for this issue. Many authors, regardless of whether AFA publishes their work, appreciate the helpful feedback provided by the reviewers. Their comments and suggestions were of great help to the authors in improving the quality of their papers. Each of the reviewers listed below returned at least one review for this issue.Reviewers for Volume 6, Number 1Adina Criste, “Victor Slavescu” Centre for Financial and Monetary Research, Romanian Academy, RomaniaAnastasia Kopaneli, University of Patras, GreeceAndrey Kudryavtsev, The Max Stern Yezreel Valley Academic College, IsraelAnthony Okafor, University of Louisville, USAAugustine Akhidime, Benson Idahosa University, NigeriaDesti Kannaiah, James Cook University, SingaporeFeng Jui Hsu, National Taichung University of Science and Technology, TaiwanGheorghe Morosan, Stefan Cel Mare University Suceava Romania, RomaniaHajar Jahangard , Central Bank of Iran(CBI), IranJayendra S. Gokhale, Embry-Riddle Aeronautical University, USALektore Oltiana Muharremi, University of Vlora, AlbaniaMarco Muscettola, Independent researcher, ItalyMawih Kareem Alani, Dhofar University, OmanMohammad Sami Ali Al-Dahrawi, Zarqa University, JordanNicoleta Radneantu, Romanian – American University, RomanianNikolay Patonov, European Polytechnical University, BulgariaNoriaki Okamoto, Rikkyo University, JapanRui Fernandes, Porto Accounting and Business School, PortugalShahram Fattahi, Razi University,, IranVolodymyr Vysochansky, Uzhhorod National University, UkraineZi-Yi Guo, Wells Fargo Bank, N.A., USA Angelia EvelynEditorial AssistantOn behalf of,The Editorial Board of Applied Finance and AccountingRedfame Publishing9450 SW Gemini Dr. #99416Beaverton, OR 97008, USAURL: http://afa.redfame.com

Estimating the volume of dirty money in Iran

In this study, the volume of dirty money in Iran was estimated. The data belonged to the period of 1997-2019, and was taken from the Central Bank of Iran (website: https://www.cbi.ir). Fuzzy logic was used to estimate the underground economy. Fuzzy theory can mathematically formulate many variables that are imprecise and ambiguous concepts. This theory is appropriate for reasoning, inference, control, and decision-making under uncertainty. This approach works in conditions of uncertainty. In cases in which the variables are inaccurate, this method is used. Fuzzy set theory is a generalization of the set theory. The underground economy is important in estimating the amount of dirty money and has a positive effect on this amount. The effect of the underground economy was investigated using the vector autoregressive (VAR) and vector error correction (VECM) models.•In this article applied the fuzzy logic, to estimate the underground economy.•The method presented in this article can be useful for Researchers and managers in the monetary trend of economics.•The fuzzy method is the best way to estimate the size of the underground economy because it is a measure of uncertainty.

How enterprise risk management (erm) can affect on short-term and long-term firm performance: evidence from the Iranian banking system

Enterprise risk management (ERM) has emerged as a more integrated risk management (IRM) framework in recent years. Many studies have been conducted in recent years to determine the effects of ERM implementation on other parts of an organization. The purpose of this research was to explore the relationship between ERM implementation and organizational performance. The research sample consisted of Iranian banks that either had a license from the central bank of Iran (CBI) or were active in the stock market. A novel measure of ERM implementation was employed in this study. Furthermore, the return on equity (ROE) and Tobin's Q ratio were used as two measures of organizational performance. The results showed that there was a positive and significant relationship between ERM implementation and Tobin's Q ratio, whereas such a significant relationship was not observed between ERM implementation and ROE. The study findings suggested that the adoption of an ERM strategy influences the long-term performance of a firm, not its short-term performance.

Social Networks, Exchange Rate Fluctuation, and Economic Growth: ARDL Approach

Abstract This study aimed to investigate the effects of social network propaganda on exchange rate and also exchange rate fluctuations on Iran economic growth. This study uses annual data to analyse the long-run and short-run relationship between variables for the period of 1993–2018. Data were collected from the Central Bank of Iran. The autoregressive distributive lag (ARDL) method proposed by Pesaran, Shin, and Smith (2001) was used. The results of long-run analysis show that a 1% increase in negative propaganda of social media about the exchange rate leads to a 3.8% decline in long-run economic growth. Also, a 1% increase in exchange rate fluctuations results in a 3.5% decrease in economic growth. Research findings also indicate negative short-run impacts of social networks on the excitement of the foreign exchange market and, ultimately, on economic growth.