Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran
Based on economic structure of a country, defense spending and security costs as a public good, can have a positive or negative impact on private sector activities. This research applies a partial coherence approach for the period 1959-2017 to evaluate the relationship between defense spending and s...
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| Format: | Article |
| Language: | fas |
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Allameh Tabataba'i University Press
2019-03-01
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| Series: | Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī |
| Subjects: | |
| Online Access: | https://joer.atu.ac.ir/article_10154_20e5841798086894a368a344c07bc17e.pdf |
| _version_ | 1797375640830214144 |
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| author | seyyed parviz jalili kamju ramin khochiani |
| author_facet | seyyed parviz jalili kamju ramin khochiani |
| author_sort | seyyed parviz jalili kamju |
| collection | DOAJ |
| description | Based on economic structure of a country, defense spending and security costs as a public good, can have a positive or negative impact on private sector activities. This research applies a partial coherence approach for the period 1959-2017 to evaluate the relationship between defense spending and security costs as two important parts of the state budget, with the formation of a fixed private capital and oil revenues with a constant tax effect. The results showed that by keeping the effect of tax revenues as fixed in four-year time scales, and in the period 1969-1978, defensive expenditures and the formation of fixed private capital were not co-phase and defense expenditure was a leading variable for the formation of fixed capital, which shows a confirmation of crowding-out effect in Iranian economy. In contrast, in period 1989-1997, these two variables are co-phase and no crowding-out effect has occurred. Also, in short- and long-term, the formation of private fixed capital is a leading variable that justifies the need for security and increasing its costs. During period 1969-1978, in the short-term, two variables of defense spending and oil revenues are in opposite phase. The two variables of security costs and oil revenues are in co-phase in the short run and the phasic difference arrows indicate the causality of oil revenues to security costs during the years 1986-1999. Based on the structure of Iranian economy and the fact that Iran does not export military equipment, it is suggested that defense spending be optimized in order to control the crowding-out effect and security costs to be increased to the point that they have a positive impact on the formation of private equity. |
| first_indexed | 2024-03-08T19:27:20Z |
| format | Article |
| id | doaj.art-334ed4a63226417fa2be4f1fbffbdea1 |
| institution | Directory Open Access Journal |
| issn | 1735-210X 2476-6453 |
| language | fas |
| last_indexed | 2024-03-08T19:27:20Z |
| publishDate | 2019-03-01 |
| publisher | Allameh Tabataba'i University Press |
| record_format | Article |
| series | Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī |
| spelling | doaj.art-334ed4a63226417fa2be4f1fbffbdea12023-12-26T08:03:12ZfasAllameh Tabataba'i University PressFaslnāmah-i Pizhūhish/Nāmah-i Iqtisādī1735-210X2476-64532019-03-011972376610.22054/joer.2019.1015410154Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iranseyyed parviz jalili kamju0ramin khochiani1Assistant Professor, Ayatollah Ozma Borujerdi UniversityAssistant Professor, Ayatollah Ozma Borujerdi UniversityBased on economic structure of a country, defense spending and security costs as a public good, can have a positive or negative impact on private sector activities. This research applies a partial coherence approach for the period 1959-2017 to evaluate the relationship between defense spending and security costs as two important parts of the state budget, with the formation of a fixed private capital and oil revenues with a constant tax effect. The results showed that by keeping the effect of tax revenues as fixed in four-year time scales, and in the period 1969-1978, defensive expenditures and the formation of fixed private capital were not co-phase and defense expenditure was a leading variable for the formation of fixed capital, which shows a confirmation of crowding-out effect in Iranian economy. In contrast, in period 1989-1997, these two variables are co-phase and no crowding-out effect has occurred. Also, in short- and long-term, the formation of private fixed capital is a leading variable that justifies the need for security and increasing its costs. During period 1969-1978, in the short-term, two variables of defense spending and oil revenues are in opposite phase. The two variables of security costs and oil revenues are in co-phase in the short run and the phasic difference arrows indicate the causality of oil revenues to security costs during the years 1986-1999. Based on the structure of Iranian economy and the fact that Iran does not export military equipment, it is suggested that defense spending be optimized in order to control the crowding-out effect and security costs to be increased to the point that they have a positive impact on the formation of private equity.https://joer.atu.ac.ir/article_10154_20e5841798086894a368a344c07bc17e.pdfdefense spendingsecurityfixed capital formationtax effectphasic difference |
| spellingShingle | seyyed parviz jalili kamju ramin khochiani Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran Faslnāmah-i Pizhūhish/Nāmah-i Iqtisādī defense spending security fixed capital formation tax effect phasic difference |
| title | Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran |
| title_full | Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran |
| title_fullStr | Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran |
| title_full_unstemmed | Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran |
| title_short | Evaluating the Relationship between Security Costs and Private Fixed Capital Formation in Iran |
| title_sort | evaluating the relationship between security costs and private fixed capital formation in iran |
| topic | defense spending security fixed capital formation tax effect phasic difference |
| url | https://joer.atu.ac.ir/article_10154_20e5841798086894a368a344c07bc17e.pdf |
| work_keys_str_mv | AT seyyedparvizjalilikamju evaluatingtherelationshipbetweensecuritycostsandprivatefixedcapitalformationiniran AT raminkhochiani evaluatingtherelationshipbetweensecuritycostsandprivatefixedcapitalformationiniran |