Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
The Nature of Banks and the Money Creation Process; Criticism of Common Views and Implications
9
38
FA
Akbar
Kumijani
Professor of Economics/ Tehran University
komijani@ut.ac.ir
Hamid
Abrishami
Professor of Economics/ Tehran University
abrihami@ut.ac.ir
Sayyid Ali
Rohani
PhD Student of Economics/ Tehran University
s.ali.rohani@gmail.com
10.30471/iee.2018.1441
The financial crisis in 2008 attracted the attention of the economists and central banks to the deficiencies of the common views on the nature of banks and their role in economy. Since an important prerequisite for micro-prudential and macro-prudential regulation is macroeconomic modeling including the financial sector, consistent monetary and fiscal policy making, and a correct and complete analysis about the nature of banks and the banking system, the present paper uses a descriptive-analytical method to investigate the three approaches to it. Thus, the common views about banks (“financial intermediation” and “deposit multiplier”) are explained and criticized on the basis of monetary and accounting principles. Moreover, the correct view about the nature of banks ("money creation of individual banks") will be explained, citing the opinions of leading economists and central banks.
Analyzing the arguments offered in support of the “financial intermediation” and “deposit multiplier” views shows that the main roots of misunderstanding the nature of banks are: the notion about money being a sort of commodity, fallacy of composition and the confusion of microeconomic and macroeconomic arguments, neglecting the double-entry bookkeeping principles, failing to differentiate between the banks’ and the central bank’s balance sheet, and lack of attention to the implications of interest rates targeting policy by the central banks. Accordingly, some principles adhering to which can guarantee a correct analysis of banks is introduced, and some implications of “money creation” view about banks in Islamic banking, monetary policy, banking regulation and macroeconomic modeling is explained.
bank,creation of money,financial intermediation,deposit multiplier,banking regulation,monetary policy,Islamic banking
https://iee.rihu.ac.ir/article_1441.html
https://iee.rihu.ac.ir/article_1441_494a83a6b5398507e9ba84895f862fa9.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
Investigation of Risk Coverage in Issuing Manufacturing Contracts in Operational Models of Parallel Manufacturing Contracts, Stock Exchange Model and Indirect Manufacturing Contracts
39
67
FA
Muhammad Naqi
Nazarpoor
Associate Professor of Economics/ Mufid University
mnnazarpur@gmail.com
Ruhullah
Ibadi
PhD Student of Economic Sciences/ Research Center of Hawzeh and University
ebadi.ro@gmail.com
Sayyid Hdi
Mir-Husseini
MA of Financial Management/ Azad University in Qods City
s.h.mirhosseyni@gmail.com
10.30471/iee.2018.1442
Applying different methods and tools to finance different economic sectors always accompany risk, and risk and return on investment and financing always accompany one another. Thus, the investment decisions are always done on the basis of and by considering the relationship between risk and returns. Investors should always consider, in their decisions, the risk factor. Because of the importance and effectiveness of the risk, as well as the impossibility of eliminating it, one must identify, calculate and manage the risks.
The need to pay attention to this issue is due to the fact that expansion and deepening of the financial market in the country should be done to eliminate the country's restrictions on the attraction of investments according to religious considerations and, at the same time, the response to the basic needs of the society should be done by expansion of the capital market of Iran and diversifying its existing tools. Introduction of manufacturing contracts papers as a powerful financial tool for financing various economic sectors can solve many challenges of Iran's financing system considering the potential and actual risk assessment and design of risk coverage of these securities to expand and publicly accept it in Iran's financial system.
In this paper, we employed descriptive-analytic method by using questionnaire data and AHP method to study the hypothesis that "Among the operational models of manufacturing contracts, the Stock Exchange Organization model is the optimal model for risk coverage."
To examine this hypothesis, some risks of issuing embedded securities in the form manufacturing contract model in the form of parallel manufacturing contract, stock market model, and indirect manufacturing contract were studied. The results show that among the operating models of embedded securities, the stock model is the best model for risk coverage.
manufacturing contract papers,operational models,risk coverage of manufacturing contract papers,AHP method
https://iee.rihu.ac.ir/article_1442.html
https://iee.rihu.ac.ir/article_1442_97be614bd1d037c36fdceac2a52fbe33.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
Investigation of the Composite Index of Economic Resilience in Iran (2005-2014)
69
94
FA
Sayyid Hussein
Mir-Jalili
Associate Professor of Economics/ Research Center of Humanities and Cultural Studies
h.jalili@yahoo.com
roshanak
bozorgi
MA Student in Economics/ Research Center of Humanities and Cultural Studies,
roshanakbozorgi@yahoo.com
10.30471/iee.2018.1443
In the present article, we have examined the resilience of Iran's economy during the years 2005-2014. To this end, a composite indigenous index comprised of the following variables is calculated and interpreted: inflation rate, unemployment rate, exchange rate, ratio of budget deficit to gross domestic product, share of oil in the government budget, ratio of non-oil exports to imports, import ratio of intermediate and primary goods to total imports, total government budget to gross domestic product, ratio of government consumption to total consumption of the economy, export and import ratio to gross domestic product, underground economy, ratio of high education graduates to total government employees, Gini coefficient, literacy rates and main members f society insured by social security organizations.
The empirical results indicate an increase in the Iran's economic resilience index. The highest figure in the index is in 2014 and the lowest is in 2005. The relationship between resilience index and GDP per capita indicates a positive relationship over the course under study, i.e. with an increase in economic resilience, GDP per capita also increases
economic resilience,composite index,Iran's economy,resistance economy
https://iee.rihu.ac.ir/article_1443.html
https://iee.rihu.ac.ir/article_1443_d9eeeecc8cd9849b8535886da5484237.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
Investigating the Possibility of Using Credit Default Swaps to Cover Sukuk Credit Risk
95
120
FA
Muhammad Hadi
Habibullahi
PhD Student of Financial Management in Imam Sadeq University/ Researcher in Development Center of the University
mhhabib.67@gmail.com
Ihsan Zaker-nia
Zaker-nia
0000-0002-5329-1716
PhD Student of Financial Management in Imam Sadeq University/ Researcher in Development Center of the University
ehsanzakernia@gmail.com
10.30471/iee.2018.1444
Issuing Islamic securities (<em>sukuk</em>) is one of the innovations of recent decades that open bright opportunities to the Islamic financial system. In this article, we have dealt with the management of credit risk to cover these risks. So far, the financial rules in Iran (rules of the Securities and Exchange Money and Credit Council and the Council) have attempted to create warranty pay guarantee obligations to cover credit risk for investors. Considering the fact that there are numerous methods to manage credit risks, the main question of this article is as follows: “which method is more preferable?” <br />Library research shows that there are two major methods in managing credit risks: validation and credit default swap. Assuming that redressing not paying off the debts is the necessary condition for issuing <em>sukuk, </em>the guarantor and credit default swaps can do this. This article first enumerates the advantages and disadvantages of each method as well as getting the views of the experts through TOPSIS process, and then, introduces the credit default swap as a better way in issuing <em>sukuk. </em>
Sukuk,credit risk,risk coverage,Sukuk guarantor,credit default swap
https://iee.rihu.ac.ir/article_1444.html
https://iee.rihu.ac.ir/article_1444_d49fe60650f3a43ca20e7e9252c284e4.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
The Proper Model for Evaluating Buy-back Contracts in Terms of Economics of Information
121
141
FA
Muhammad Mahdi
Askari
Associate Professor in Imam Sadeq University
m.askari@isu.ac.ir
Hamid Reza
Ma’budi
PhD Student of Management of International Contracts in Oil and Gas/ Imam Sadeq Univeristy
hrmaboodi@yahoo.com
10.30471/iee.2018.1445
Discussions related to the ‘agent’ and ‘employer’ and their interaction in the form of various contracts are among the common discussions in economics. Thus, the contracts and the agent-employer theories have dealt with it in a variety of contexts. Moral hazards in contracts, especially international oil contracts, are a key subject under the economics of information to present motivational models for maximizing the interests of both parties. <br />One of the common oil contracts is the buy-back contract. They have been completed and modified in the course of history in the form of 1<sup>st</sup>,2<sup>nd</sup> and 3<sup>rd</sup> generation contracts. <br />In this article, we have tried, considering the 3<sup>rd</sup> generation of oil and gas industry specifications, oil contracts and moral hazard models, to choose the proper model for evaluating buy-back contracts. <br />An investigation of various models of moral hazards shows that moral hazard from both parties could be seen in oil contracts and that both are trying to maximizing their profit. Accordingly, standard model is not proper to evaluate this type of contract and two-sided moral hazard models are more proper in oil contracts.
Buy-Back Contracts,Asymmetric information,Moral Hazard,two-sided Moral Hazard,Iranian Oil contracts
https://iee.rihu.ac.ir/article_1445.html
https://iee.rihu.ac.ir/article_1445_eb808c915c8bab45feb251ad9aa654a4.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
The Relationship of Corruption, Property Rights, Unequal Incomes and Democracy: Empirical Evidence from Selected Countries
143
172
FA
Hamid
Sepehrdoust
Associate Professor, Department of Economics, Faculty of Economics & Social Science, Bu-Ali-Sina University
hamidbasu1340@gmail.com
Adel
Berjisian
Ph.D student of Economics, Faculty of Economics & Social Science, Bu-Ali-Sina University
adelberjisian@gmail.com
10.30471/iee.2018.1446
Corruption is a phenomenon of economic, political and cultural disorder, with more or less hazardous effects both in developed and developing countries. In this regard, North and his colleagues (2015) emphasize that only in an open access system (democracy), corruption is controlled and other measures such as improving property rights, although useful in improving the conditions, are not enough to reduce corruption significantly. As this phenomenon is considered one of the most important barriers to growth of developing countries such as Iran with its resistance approaches to economy, identifying the roots and dealing with it has become seriously considered as country's development goals.
The purpose of this study was firstly identifying the phenomenon of corruption in a general equilibrium analysis, and to investigating its relationship with some political-economic influential variables such as property rights and democracy. To do so, a panel model was used to analyze relevant data from 53 selected developing countries for the period of 1996 to 2013. The results indicated a significant negative effect of democracy (-0.49), property rights (-7.56), economic growth (-0.37) and investment (-5.75) on the level of corruption. Moreover, the Gini coefficient of inequality (0.36) and political instability (19.4) showed a significant and positive effect on the corruption index.
In general, economic and political inequalities would weaken the bases of democracy and prepare the ground for a diffusion of corruption in the society. However, the effect of democracy on corruption is dependant on variable of property rights, in a way that with an increase in protection of property rights, democracy can have a better function in controlling corruption, especially in countries with abuse of privileged information in their economy.
corruption,inequality of income,democracy,property rights,panel data
https://iee.rihu.ac.ir/article_1446.html
https://iee.rihu.ac.ir/article_1446_6d07342c4bd92e2e66122f5c0aa98b4a.pdf
Research Institute of Hawzah and University; "Hawzah wa Dāneshgāh Research Institute"
Journal of Iran's Economic Essays (JIEE)
1735-3300
2588-5812
15
29
2018
03
21
The Views of Hayek, Rawls, Motahhari and Sadr on Social Justice with an Emphasis on the Nature of Justice
173
199
FA
Ali-Reza
Jalili Marand
0000-0003-2644-9765
PhD Student of Economic Sciences/ Tabriz University
alireza.jalili.m@gmail.com
Muhammad Ali
Mutaffaker Azad
0000-0002-1829-230X
Professor of Economic Sciences/ Tabriz University
m.motafakker@gmail.com
Firooz
Fallahi
Associate Professor of Economic Sciences/ Tabriz University
firfal@yahoo.com
10.30471/iee.2018.1447
T
This study explores the concept of social justice based on the ideas of four contemporary theorists, with an emphasis on the nature of justice. Hayek represents libertarians, Rawls as the most prominent political philosopher of current century in the West, and Motahhari and Sadr were selected as Islamic theorists. Hayek only believes in individual justice and maintains that there is no concept as social justice. For him, justice constitutes rules for individual conduct. The concept of “spontaneous order” plays an essential role in his ideas, and he maintains that most of the social phenomena follow such an order.
Rawls’ main goal
sees ‘justice as fairness’ as answering to the demands of both freedom and equality, a challenge posed by the socialist critique of liberal democracy. In this regard justice is an agreement on principles which is reached arbitrarily in “veil of ignorance”. Rawls's main guide in achieving principles of justice is maximin principle and the lack of awareness of individuals about the future social status. Motahari regards justice as observance of the law. He recognizes both the natural rights of the individual and the legal community. According to Shahid Motahari, the only way to legitimize and validate natural rights is to accept the purpose of the world order. In Sadr's view, although justice is one of the three principles of the general construction of Islamic economics, the position of justice is beyond the core and is the foundation stone of the Islamic School of Economics. Additionally, Islam has shown its sensitivity to the final makeup of facilities in society, with two principles: public cooperation and social balance.
Social Justice,Spontaneous Order,Maximin Principle,natural Rights,Social Balance
https://iee.rihu.ac.ir/article_1447.html
https://iee.rihu.ac.ir/article_1447_453ab22ae4bfded3921a2c8b90d6d30a.pdf