The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE)
Changes in exchange rate have different effects on macroeconomic variables and poverty rates through different channels in the economy. Evaluating the effects of policies and economic shocks on poverty requires the use of a method that firstly takes into account different sectors of the economy in a...
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| Format: | Article |
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Tarbiat Modares University
2020-03-01
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| Series: | پژوهشهای اقتصادی |
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| Online Access: | http://ecor.modares.ac.ir/article-18-29947-en.pdf |
| _version_ | 1827924915890683904 |
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| author | Soheila Parvin Ali Asghar Banouei Golrooz Ramezanzadeh velis |
| author_facet | Soheila Parvin Ali Asghar Banouei Golrooz Ramezanzadeh velis |
| author_sort | Soheila Parvin |
| collection | DOAJ |
| description | Changes in exchange rate have different effects on macroeconomic variables and poverty rates through different channels in the economy. Evaluating the effects of policies and economic shocks on poverty requires the use of a method that firstly takes into account different sectors of the economy in a given model, and secondly can reflect both macroeconomic policies and the response of various economic institutions. For this purpose, we use the Computable General Equilibrium (CGE) model in which the household sector is disaggregated into ten categories of income and the poverty line is determined as an endogenous variable in the model. This model is solved based on the Social Accounting Matrix (SAM) of 2011 and two scenarios of 25 percent and 35 percent increases in exchange rate are simulated. The results of both simulations show that the increase in exchange rates leads to a reduction in real incomes of the both rural and urban households, and consequently lower-income households are affected highly. The unification of exchange rate also increases poverty line and poverty measures of the FGT group (headcount ratio, poverty gap and poverty severity), so that the poverty line and poverty measures for urban households are higher than rural households. |
| first_indexed | 2024-03-13T05:18:40Z |
| format | Article |
| id | doaj.art-eaf4758a3ba84181922cba6faea4b525 |
| institution | Directory Open Access Journal |
| issn | 1735-6768 2980-7832 |
| language | fas |
| last_indexed | 2024-03-13T05:18:40Z |
| publishDate | 2020-03-01 |
| publisher | Tarbiat Modares University |
| record_format | Article |
| series | پژوهشهای اقتصادی |
| spelling | doaj.art-eaf4758a3ba84181922cba6faea4b5252023-06-15T20:24:31ZfasTarbiat Modares Universityپژوهشهای اقتصادی1735-67682980-78322020-03-01201184153The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE)Soheila Parvin0Ali Asghar Banouei1Golrooz Ramezanzadeh velis2 Professor of Economics, Allameh Tabataba`i University Professor of Economics, Allameh Tabataba`i University PhD Candidate in Economics, Allameh Tabataba`i University Changes in exchange rate have different effects on macroeconomic variables and poverty rates through different channels in the economy. Evaluating the effects of policies and economic shocks on poverty requires the use of a method that firstly takes into account different sectors of the economy in a given model, and secondly can reflect both macroeconomic policies and the response of various economic institutions. For this purpose, we use the Computable General Equilibrium (CGE) model in which the household sector is disaggregated into ten categories of income and the poverty line is determined as an endogenous variable in the model. This model is solved based on the Social Accounting Matrix (SAM) of 2011 and two scenarios of 25 percent and 35 percent increases in exchange rate are simulated. The results of both simulations show that the increase in exchange rates leads to a reduction in real incomes of the both rural and urban households, and consequently lower-income households are affected highly. The unification of exchange rate also increases poverty line and poverty measures of the FGT group (headcount ratio, poverty gap and poverty severity), so that the poverty line and poverty measures for urban households are higher than rural households.http://ecor.modares.ac.ir/article-18-29947-en.pdfunification of exchange rateendogenous poverty linefgt poverty measurescomputable general equilibrium (cge) |
| spellingShingle | Soheila Parvin Ali Asghar Banouei Golrooz Ramezanzadeh velis The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) پژوهشهای اقتصادی unification of exchange rate endogenous poverty line fgt poverty measures computable general equilibrium (cge) |
| title | The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) |
| title_full | The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) |
| title_fullStr | The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) |
| title_full_unstemmed | The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) |
| title_short | The Effect of Unification of Exchange Rate on Poverty in Iran Using the Computable General Equilibrium Model (CGE) |
| title_sort | effect of unification of exchange rate on poverty in iran using the computable general equilibrium model cge |
| topic | unification of exchange rate endogenous poverty line fgt poverty measures computable general equilibrium (cge) |
| url | http://ecor.modares.ac.ir/article-18-29947-en.pdf |
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