Technology Spillover, Value Added and Resistive Economy in Iran: A Computable General Equilibrium

Sheikhiani, Hamzeh; Samadi, Ali Hossein; Hadian, Ebrahin; Rostamzadeh, Parviz

Technology Spillover, Value Added and Resistive Economy in Iran: A Computable General Equilibrium

Document Type : Original Article

Authors

¹ Ph.D. of Economics at Shiraz University

² Associate Professor of Economics, Shiraz University

³ Associate Professor of Economics, Shiraz University, Shiraz

⁴ Assistant Professor of Economics, Shiraz University

Abstract

One of the most important economic sectors emphasized in resistive economy policies is the value added and production sector. Economic institutions can influence value added by increasing technology spillover and productivity. The purpose of this paper is to investigate the effect of resistive economy policies on the value added of various economic sectors. In order to achieve this goal, the Decalou et al. Model (2013) has been modified and the effect of the resistance index on the technological spillover and production function has been investigated. The main question is how does the resistive economy policies affect the added value of economic sectors? To answer this question, we use a general equilibrium model and GAMS software. The results of the first scenario indicate that in the absence of enforcement policies, value added in agricultural, service and other sectors decrease, but positive changes are observed in industry, oil and gas and mining sectors. In the second scenario, the results show that with the improvement of the economic institutions due to implementation of the resistive economy policies, value added in all sectors would increase. Therefore, it is suggested that the improvement of the institutional status of the economy be considered alongside the implementation of these policies.

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