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Articles 1 - 5 of 5
Full-Text Articles in Social and Behavioral Sciences
Demographic Transition In Resource Rich Countries: A Bonus Or A Curse?, Kjetil Bjorvatn, Mohammad Reza Farzanegan
Demographic Transition In Resource Rich Countries: A Bonus Or A Curse?, Kjetil Bjorvatn, Mohammad Reza Farzanegan
Prof. Dr. Mohammad Reza Farzanegan
While East Asia benefited significantly from its demographic transition in the 1970s and 1980s, the youth wave that we currently observe in the Middle East and North Africa (MENA) has not had a similar impact on economic development. The present study argues that resource wealth is an important reason for understanding why. We develop a simple model highlighting how the income effect of increased labor supply may depend on resource rents, and provide empirical evidence that support the theoretical predictions. Using panel data covering the period from 1970–2006 for more than 120 countries, we find a negative interaction effect between …
Resource Wealth And Entrepreneurship: A Blessing Or A Curse?, Mohammad Reza Farzanegan
Resource Wealth And Entrepreneurship: A Blessing Or A Curse?, Mohammad Reza Farzanegan
Prof. Dr. Mohammad Reza Farzanegan
Resource-rich countries of the Middle East and North Africa (MENA) have the highest youth unemployment rate in the world. While other parts of the world are experiencing an increasing trend in new firms’ formation as a potential solution for their unemployment problem, the MENA region has the lowest records in new business establishments. In this study, we investigate the reasons behind such a significant lag of the resource-rich countries in entrepreneurship. Panel data for more than 80 countries from 2004-2009 shows that higher dependence on resource rents reduces entrepreneurship activities. The decline is more significant in countries with higher levels …
Natural Resources And Internal Conflicts - How Decentralization Lifts The Curse, Mohammad Reza Farzanegan, Gunther Markwardt, Christian Lessmann
Natural Resources And Internal Conflicts - How Decentralization Lifts The Curse, Mohammad Reza Farzanegan, Gunther Markwardt, Christian Lessmann
Prof. Dr. Mohammad Reza Farzanegan
We study how the natural resource endowments affect risk of internal conflicts and how this effect depends on decentralization levels in a political system. Resource rents, especially lootable resources such as oil, finance conflicts, creating strong separatist movements. Our main hypothesis is that increasing the levels of political decentralization can limit the destructive effect of the natural resource rents on internal conflicts. We use cross-country and panel data covering the period from 1984–2004 from more than 80 countries to test this hypothesis. Our estimates confirm that the relationship between the natural resource rents and risk of internal conflict is dependent …
Military Spending And Economic Growth: The Case Of Iran, Mohammad Reza Farzanegan
Military Spending And Economic Growth: The Case Of Iran, Mohammad Reza Farzanegan
Prof. Dr. Mohammad Reza Farzanegan
Iranian government budget on military over the last decade has been higher than the average of the world. The current increasing international sanctions aim to reduce the military capabilities and capacities of the Iranian government. In this study, we analyze the response of the Iranian economy to shocks in its military budget from 1959-2007, using Impulse Response Functions (IRF) and Variance Decomposition Analysis (VDA) techniques. The Granger causality results show that there is unidirectional causality from military spending to the economic growth. The response of income growth to increasing shocks in the military budget is positive and statistically significant.
Resource Curse And Power Balance: Evidence From Iran, Kjetil Bjorvatn, Mohammad Reza Farzanegan, Friedrich Schneider
Resource Curse And Power Balance: Evidence From Iran, Kjetil Bjorvatn, Mohammad Reza Farzanegan, Friedrich Schneider
Prof. Dr. Mohammad Reza Farzanegan
Empirical research shows that natural resources have a detrimental effect on economic growth, a phenomenon known as the “resource curse”. Competition between influence groups for access to the resource rents, that is, rent-seeking, is often blamed for this curse. In this paper we dig deeper into the link between political competition and the resource curse by studying the case of Iran from 1960-2007. We present a theoretical model demonstrating how the effect of rents on the economy depends on the balance of political power. The model shows that an increase in rents may lead to a sharp reduction in income …