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Volume 0, Issue 0 (Articles accepted for Publication 2024)
Abstract
Aim and Introduction
After the global economic recession in 2008-2009, the discussion about countercyclical and procyclical fiscal policies and their effects on the economy began. Countercyclical fiscal policy is applied to reduce economic fluctuations by adjusting government spending and taxes against the business cycle. The aim of this policy is to stabilize the economy and flatten its fluctuations. On the contrary, procyclical fiscal policy strengthens economic fluctuations in the direction of business cycles. On the other hand, fiscal sustainability refers to the government's ability to maintain expenditures, income and public debt at a certain level in the long term without jeopardizing economic stability or facing a fiscal crisis. A sustainable fiscal policy ensures that the government's debt in the long run is at a level proportional to the size of the economy. The main questions of this research are as follows:
After the global economic recession in 2008-2009, the discussion about countercyclical and procyclical fiscal policies and their effects on the economy began. Countercyclical fiscal policy is applied to reduce economic fluctuations by adjusting government spending and taxes against the business cycle. The aim of this policy is to stabilize the economy and flatten its fluctuations. On the contrary, procyclical fiscal policy strengthens economic fluctuations in the direction of business cycles. On the other hand, fiscal sustainability refers to the government's ability to maintain expenditures, income and public debt at a certain level in the long term without jeopardizing economic stability or facing a fiscal crisis. A sustainable fiscal policy ensures that the government's debt in the long run is at a level proportional to the size of the economy. The main questions of this research are as follows:
- Is Iran's fiscal policy countercyclical or procyclical?
- Is Iran's fiscal policy sustainable?
- What is the effect of cyclical fiscal policy and fiscal sustainability on the Iranian economic growth?
- How is the mutual relationship between fiscal sustainability and cyclical fiscal policy in Iran?
Methodology
The evaluation of fiscal policy cyclicality and fiscal sustainability and their determinants have been previously researched. However, the effect of cyclical fiscal policy and fiscal sustainability on economic growth and their mutual relationship has not been covered. This research, has utilized Iran's 1970-2021 annual data and a state-space model with time-varying parameters and an autoregressive distributed lags model as well as Kalman filter method. Moreover, to evaluate Iran's cyclical fiscal policy and fiscal sustainability, the effect of cyclical fiscal policy and fiscal sustainability on economic growth have been investigated. The research also deals with the mutual effect between cyclical fiscal policy and fiscal sustainability in Iran.
Findings
In this research, in order to evaluate the cyclical behavior of Iran's fiscal policy and obtaining the index, a state-space model with time-varying parameters, is estimated in which the real GDP logarithm coefficient varies over time. Then, in order to assess Iran's fiscal sustainability and obtaining the index, a state-space model with time-varying parameters is estimated. Finally, an autoregressive distributed lags model is utilized to estimate the effect of cyclical fiscal policy index and fiscal sustainability index on economic growth, as well as estimating the mutual effect between cyclical fiscal policy index and fiscal sustainability index.
Discussion and Conclusion
The findings of this research show: First, Iran's cyclical fiscal policy index estimated in all years is positive and has not recorded a negative number in any year, which means that the fiscal policy implemented in Iran during the period 1970-2021, was procyclical. In other words, the fiscal policy implemented in Iran has increased the range of fluctuations of cycles and for this reason, it has made the Iranian economy vulnerable to the economic shocks. Second, the estimated Iran's fiscal sustainability index is negative in most years so that the average fiscal sustainability index in the entire period is -0.068. This indicates the unsustainability of Iran's fiscal policy in the period 1970-2021. The trend of the smoothed changes of the time-varying parameter related to the fiscal sustainability index is also downward, which means that Iran's fiscal sustainability has been weakening over time and has moved in the direction of unsustainability. Third, Iran's cyclical fiscal policy index has had a negative effect on economic growth. In other words, procyclical behavior of Iran's fiscal policy has slowed down the economic growth rate. Fourth, Iran's fiscal sustainability index has a negative and significant effect on economic growth. Based on the estimated fiscal sustainability index, unsustainability is evident within Iran's fiscal policy. Therefore, unsustainability of Iran's fiscal policy has weakened economic growth. Fifth, Iran's fiscal unsustainability has increased the procyclical behavior of fiscal policy and as a result, exacerbated the fluctuations of economic cycles. Sixth, the increasing Iran's cyclical fiscal policy index reduces the reaction of the primary balance to the government debt. In other words, the increase in the procyclical behavior of the fiscal policy weakens Iran's fiscal sustainability
The evaluation of fiscal policy cyclicality and fiscal sustainability and their determinants have been previously researched. However, the effect of cyclical fiscal policy and fiscal sustainability on economic growth and their mutual relationship has not been covered. This research, has utilized Iran's 1970-2021 annual data and a state-space model with time-varying parameters and an autoregressive distributed lags model as well as Kalman filter method. Moreover, to evaluate Iran's cyclical fiscal policy and fiscal sustainability, the effect of cyclical fiscal policy and fiscal sustainability on economic growth have been investigated. The research also deals with the mutual effect between cyclical fiscal policy and fiscal sustainability in Iran.
Findings
In this research, in order to evaluate the cyclical behavior of Iran's fiscal policy and obtaining the index, a state-space model with time-varying parameters, is estimated in which the real GDP logarithm coefficient varies over time. Then, in order to assess Iran's fiscal sustainability and obtaining the index, a state-space model with time-varying parameters is estimated. Finally, an autoregressive distributed lags model is utilized to estimate the effect of cyclical fiscal policy index and fiscal sustainability index on economic growth, as well as estimating the mutual effect between cyclical fiscal policy index and fiscal sustainability index.
Discussion and Conclusion
The findings of this research show: First, Iran's cyclical fiscal policy index estimated in all years is positive and has not recorded a negative number in any year, which means that the fiscal policy implemented in Iran during the period 1970-2021, was procyclical. In other words, the fiscal policy implemented in Iran has increased the range of fluctuations of cycles and for this reason, it has made the Iranian economy vulnerable to the economic shocks. Second, the estimated Iran's fiscal sustainability index is negative in most years so that the average fiscal sustainability index in the entire period is -0.068. This indicates the unsustainability of Iran's fiscal policy in the period 1970-2021. The trend of the smoothed changes of the time-varying parameter related to the fiscal sustainability index is also downward, which means that Iran's fiscal sustainability has been weakening over time and has moved in the direction of unsustainability. Third, Iran's cyclical fiscal policy index has had a negative effect on economic growth. In other words, procyclical behavior of Iran's fiscal policy has slowed down the economic growth rate. Fourth, Iran's fiscal sustainability index has a negative and significant effect on economic growth. Based on the estimated fiscal sustainability index, unsustainability is evident within Iran's fiscal policy. Therefore, unsustainability of Iran's fiscal policy has weakened economic growth. Fifth, Iran's fiscal unsustainability has increased the procyclical behavior of fiscal policy and as a result, exacerbated the fluctuations of economic cycles. Sixth, the increasing Iran's cyclical fiscal policy index reduces the reaction of the primary balance to the government debt. In other words, the increase in the procyclical behavior of the fiscal policy weakens Iran's fiscal sustainability
Volume 9, Issue 3 (2-2020)
Abstract
IT governance is the ability to direct and organize information technology and identify the responsibilities between IT and business align with the organizational goals. This research intends to "survey the mediating role of operational coordination in the effect of strategy alignment on IT governance maturity”. The statistical population in the qualitative sector includes the IT experts and in the quantitative part is the senior managers of the IT and business departments of TCI. This study is an applied-developmental purpose and it is descriptive-survey in nature as well. The data collection tools are library resources, interviews, and a researcher-made questionnaire whose content validity has been verified by experts. The innovation of this study is to introduce the variable "Operational coordination" that leads to objectification of the "IT-Business strategy alignment” in order to realize the IT governance maturity. The research model was designed in two dimensions as a combination of Loftman's strategy alignment and business process management methodology (including 10 key components and 55 indicators). Its content validity and reliability were confirmed by experts using Cronbach's alpha coefficient (0.936). Structural validity, structure and fit of the model were investigated by using structural equation modeling with SmartPLS software and the research hypotheses were tested. The results showed that the effects of both strategy alignment and operational coordination variables on the IT governance maturity were positive and significant. The Sobel test results also confirmed the mediating role of variable operational coordination in the effect of strategy alignment on IT governance maturity.
Volume 12, Issue 4 (October & November 2021 2021)
Abstract
One of the concepts of "even", which is the reporter of human experiential work, has been found in the Qurchr('39')an, is to explain its impact on Quranic conceptualizations, hence, among the various roles of the letter, even of attention to the texture and different applications are obtained, the role of which leads to the transmission of a route from the state, position or rank to another state and order. This is described by descriptive-analytic method and by explaining the main and focal meaning of the letter and extraction of verses in which even the abstract concept of "transference" is explained in a metaphorical way, provides a more detailed analysis of the function of this verse in the verses and the basis for constructing this concept, which is shaped by the physical and human experiences, is to illustrate the methodological importance in the more actual interpretation of the Qurchr('39')anic words, including the letters.
1. Introduction
The letter "Hatta" (even) in the Qur'an is used with high frequency to indicate the end of the hypothetical end, and in fact indicates the process of formation of the end point. But in different applications, another meaning is formed around this prototype meaning. Due to the ambiguous nature of the letter "Hatta" (even), this word was chosen as an example to examine its various conceptual maps. The main secondary and peripheral meanings obtained; were metaphorical; That is, due to the local meaning of the letter, "Hatta" (even) in a specific incomprehensible concept is objectively manifested in the destination domain by mapping to the origin domain or illustrated through schemas without occurring mapping of concepts. Accordingly, the first branch of the conceptual network of this letter is the all-meaning branch, which has found semantic commonalities with the two words "when" and "otherwise". The second radial periphery of this letter is the metaphorical secondary meanings, which include "accumulation", "transfer", "cover", etc. The third branch has even taken on the task of schematic design, which depicts volumetric, kinetic, power, and directional schemas that have been examined with Qur'anic evidence.
2. Research purposes
Therefore, the purpose of this article is to discover the semantic periphery of the letter "Hatta" (even) and how it is plotted in the verses of the Qur'an, in this way, a more accurate interpretation of this word is presented in the verses and the shortcomings in understanding the verses are eliminated.
3. Research Questions
The present article seeks to answer the following questions:
1. According to the cognitive approach, how can the sample preview of meaning of the preposition of the letter "Hatta" (even) be explained?
2. Where are the semantic periphery of the letter "Hatta" (even?
3. 3. How are the interpretive omissions of the verses analyzed by determining the semantic radii?
This letter seems to have been used to illustrate the hypothetical end of the process of gradual formation of verb. To pay attention to this letter plays an important role in explaining the more accurate interpretation of the verses in which this letter is used. Therefore, it can be said that the study of this letter gives several meanings that are connected in the meaning of the sample; therefore, it forms a periphery of meanings around the central meaning.
4. Methodology
Regarding the research approach, the researchers' view to obtain the semantic periphery of letters, even in the verses of the Qur'an, is a view that pays attention to the findings of cognitive linguistics. In fact, from the point of view of cognitive linguists such as Lakoff and Johnson, the authors have analyzed the content of verses in which the word has even been used. Regarding the research method, it should be said that the method used in this paper is conceptual analysis. Conceptual analysis is a method that is used to express the meaning and concept of words and phrases, in order to discover the hidden intentions of the speaker behind his statements.
5. Result
According to the studies conducted in the text of the article, the letter "Hatta" (even) in the Qur'an has a central meaning with the concept of a hypothetical end. But the function, even in the applied context of the verses, has not only conceptualized the same meaning, but has also encoded a periphery of other radial meanings by being placed in different structures. Accordingly, the letter even has a periphery of meanings, not a specific meaning. Therefore, sometimes with all the meanings of Ki and Ella, it is included in the inclusive expansion of its meaning, in some cases, it explains metaphorical meanings such as impossibility, result, condition and aggregation, and so on. In this way, by using this letter, a tangible and physical domain is the basis of the abstract domain, so that through this, complex revelatory concepts are brought closer to the audience's mind, in other words, they are in the domain of recognizing them. Finally, a conceptual analysis of letter "Hatta" (even) using the method of cognitive semantics showed that this word sometimes drew schemas such as volumetric, kinetic and power schemas to simplify non-empirical concepts. With the discovery of this semantic periphery, another consequence was the correction of misunderstandings and interpretive tolerances that arose from ignoring the diversity of the conceptual role of this word in Qur'anic expressions.
Volume 25, Issue 1 (Spriing 2025)
Abstract
Aim and Introduction
A balanced government budget plays a decisive role in the stability of the macroeconomics, and the continuous budget deficit puts the stability of the economy at risk. A budget deficit transpires when the expansion in government expenditures exceeds the growth in government revenue. On the other hand, one of the reasons for the government debt enlargement is the continuous budget deficit. Permanent budget deficit has harmful effects on the economy. Therefore, economists recommend that the government should prevent excessive increase in debt by maintaining a sustainable fiscal policy. Fiscal policy is sustainable when the government reacts to the debt swelling by creating an adequate budget surplus. On the contrary, unsustainable fiscal policy causes crises such as suboptimal allocation of resources, failure in financial markets and high inflation rates. Iran's economy has always been struggling with the permanent budget deficit and high debt stocks. The major motive for this is the dependence of the Iranian government's revenues on the sale of crude oil and its products, because with the decrease in oil revenues, the government resorted to borrowing to compensate for its budget deficit, resulting in debt accretion. Therefore, it is necessary to understand the perspective of fiscal sustainability in Iran. The objective of this research is to assess Iran's government fiscal sustainability and its influential factors by employing annual data of Iran's economy from 1971 to 2022 and by utilizing constant parameter fiscal reaction functions including linear and non-linear models, time-varying parameter fiscal reaction function, Markov-switching fiscal regime change model and fiscal reaction function including control variables.
Methodology
The existing literature about fiscal sustainability in Iran, has mainly examined fiscal sustainability in the framework of constant parameter linear fiscal reaction function. This research assesses different models of fiscal reaction function, such as constant parameter linear and non-linear models, time-varying parameter models and Markov-switching fiscal regime change models regarding Iran's fiscal sustainability. It also evaluates the dominant variables affecting Iran's fiscal sustainability.
Results and Discussion
In this research, firstly, the Iran's government fiscal sustainability is tested through the constant parameter linear and non-linear fiscal reaction functions, and to identify the variables affecting fiscal sustainability, the model including control variables is utilized. Then the Markov-switching fiscal regime change model and the time-varying parameter fiscal reaction function are estimated. Among the constant parameter linear and non-linear models, only the linear model including control variables has a significant debt-to-GDP ratio coefficient, which its sign is negative. Hence, it indicates that the fiscal policy implemented in Iran is unsustainable. The Markov-Switching fiscal regime change model shows the existence of two fiscal regimes, one unsustainable fiscal rgime where the reaction of the primary budget balance to public debt is significant and negative and one sustainable fiscal regime where the reaction of the primary budget balance to public debt is insignificant and positive. Also, the results show that the expected duration of the unsustainable fiscal regime is longer than the expected duration of the sustainable fiscal regime. The results of the time-varying parameter model show that the trend of the smoothed changes of the time-varying parameter is downward during the time, therefore, Iran's fiscal policy has proceeded in an unsustainable direction.
Conclusion
The results of the model including the control variables and the time-varying parameter model and the Markov-switching fiscal regime change model show that Iran's fiscal policy is unsustainable. Also, on the basis of this research findings, the variables of the output gap, the government revenue to GDP ratio and exchange rate fluctuation have a positive impact, and the variables of the government real cyclical expenditure and the old population ratio have a negative impact on the fiscal sustainability in Iran. Based on the results of this research, the government debt reduction has not been the priority of the governments in Iran. This has caused unsustainable fiscal policy which in turn, made the Iranian economy more and more vulnerable with regard to external shocks. While developing revenue sources and reducing dependence on oil revenues, the government should reduce its borrowing and therefore decrease the public debt and take steps towards sustainable fiscal policy to help achieving economic stability and sustainable growth in the long-term
A balanced government budget plays a decisive role in the stability of the macroeconomics, and the continuous budget deficit puts the stability of the economy at risk. A budget deficit transpires when the expansion in government expenditures exceeds the growth in government revenue. On the other hand, one of the reasons for the government debt enlargement is the continuous budget deficit. Permanent budget deficit has harmful effects on the economy. Therefore, economists recommend that the government should prevent excessive increase in debt by maintaining a sustainable fiscal policy. Fiscal policy is sustainable when the government reacts to the debt swelling by creating an adequate budget surplus. On the contrary, unsustainable fiscal policy causes crises such as suboptimal allocation of resources, failure in financial markets and high inflation rates. Iran's economy has always been struggling with the permanent budget deficit and high debt stocks. The major motive for this is the dependence of the Iranian government's revenues on the sale of crude oil and its products, because with the decrease in oil revenues, the government resorted to borrowing to compensate for its budget deficit, resulting in debt accretion. Therefore, it is necessary to understand the perspective of fiscal sustainability in Iran. The objective of this research is to assess Iran's government fiscal sustainability and its influential factors by employing annual data of Iran's economy from 1971 to 2022 and by utilizing constant parameter fiscal reaction functions including linear and non-linear models, time-varying parameter fiscal reaction function, Markov-switching fiscal regime change model and fiscal reaction function including control variables.
Methodology
The existing literature about fiscal sustainability in Iran, has mainly examined fiscal sustainability in the framework of constant parameter linear fiscal reaction function. This research assesses different models of fiscal reaction function, such as constant parameter linear and non-linear models, time-varying parameter models and Markov-switching fiscal regime change models regarding Iran's fiscal sustainability. It also evaluates the dominant variables affecting Iran's fiscal sustainability.
Results and Discussion
In this research, firstly, the Iran's government fiscal sustainability is tested through the constant parameter linear and non-linear fiscal reaction functions, and to identify the variables affecting fiscal sustainability, the model including control variables is utilized. Then the Markov-switching fiscal regime change model and the time-varying parameter fiscal reaction function are estimated. Among the constant parameter linear and non-linear models, only the linear model including control variables has a significant debt-to-GDP ratio coefficient, which its sign is negative. Hence, it indicates that the fiscal policy implemented in Iran is unsustainable. The Markov-Switching fiscal regime change model shows the existence of two fiscal regimes, one unsustainable fiscal rgime where the reaction of the primary budget balance to public debt is significant and negative and one sustainable fiscal regime where the reaction of the primary budget balance to public debt is insignificant and positive. Also, the results show that the expected duration of the unsustainable fiscal regime is longer than the expected duration of the sustainable fiscal regime. The results of the time-varying parameter model show that the trend of the smoothed changes of the time-varying parameter is downward during the time, therefore, Iran's fiscal policy has proceeded in an unsustainable direction.
Conclusion
The results of the model including the control variables and the time-varying parameter model and the Markov-switching fiscal regime change model show that Iran's fiscal policy is unsustainable. Also, on the basis of this research findings, the variables of the output gap, the government revenue to GDP ratio and exchange rate fluctuation have a positive impact, and the variables of the government real cyclical expenditure and the old population ratio have a negative impact on the fiscal sustainability in Iran. Based on the results of this research, the government debt reduction has not been the priority of the governments in Iran. This has caused unsustainable fiscal policy which in turn, made the Iranian economy more and more vulnerable with regard to external shocks. While developing revenue sources and reducing dependence on oil revenues, the government should reduce its borrowing and therefore decrease the public debt and take steps towards sustainable fiscal policy to help achieving economic stability and sustainable growth in the long-term
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