Where Is Iran's Economy Going?

Yasir Rashid Researcher, Economy

Where Is Iran's Economy Going? (Eghtesad-e Iran be Kodam Su Miravad?)

Nili, M. (1393). "Where Is Iran's Economy Going? [Eghtesad-e Iran be Koja Meravad]". Tehran: Donya-e Eqtesad Publisher. 840 pages.

ISBN: 978-6007106907

The book "Where is Iran's Economy Going?" was written by Massoud Nili, a prominent Iranian economist, in collaboration with several other economists and researchers, and has been published by Donya-e-Eqtesad Publications in 2014. A wide range of economic issues in Iran has been studied in this 840-page book, written in Persian, and a lot of information has been presented in the form of tables and graphs.

Masoud Nili, the author of this book, was born in 1955 in the city of Hamedan, Iran. He has a BSc in Structural Engineering, Sharif University of Technology (Tehran), MSc in Economic Systems Planning, Isfahan University of Technology (Isfahan), and MA and Ph.D. in Economics, University of Manchester (Manchester, UK). Currently, he is an Associate Professor at the Sharif University of Technology in Iran. Nili also has served as secretary of the Government's Economic Coordination Headquarters and adviser to the president during Hassan Rouhani's presidency. In addition, working as a dean of Graduate School of Management and Economics at the Sharif University of Technology, head of Institute for Research and Planning in Higher Education (IRPHE) of Iran, head of Privatization Committee during the presidency of Mohammad Khatami, and manager of the "Industrial Development Strategy of Iran" project is among his central executive and official functions in Iran.

In this book, in addition to statistics and information on macroeconomic variables in Iran, Masood Nili has attempted to provide a consistent and coherent analysis of the evolution of figures and indicators on the Iranian economy. Undoubtedly, the distinguishing feature of this book from similar volumes is the presence of an analytical mentality that tried to establish a connection between the various chapters and the main analysis of this book.

This book consists of three sections (plus introduction and conclusion), each of them is divided into different chapters. The book begins with an introduction that describes the organization of the research as well as the various sections of the volume. The first section of the book consists of four chapters and is dedicated to presenting a summary of the comprehensive picture of Iran's economy. The first chapter of this section focuses on macroeconomic developments in the first decade of this century (2001-2010/1380-1389) and analyzes various markets such as energy, currency, products, finance and finally, labor. The second chapter discusses the issue of privatization in Iran, the obstacles to this process and its effects on the various markets of the Iranian economy. Chapter three analyzes the targeting of subsidies, including the impact of rising energy prices on government budgets, businesses, and households. The fourth chapter of this section explores the outlook for Iran's economy in the medium term (2013 to 2017). Besides, it examines the future of Iran's macroeconomic development and the scenario of Iran's macroeconomic policy reform.

The second section of the book is devoted to the domestic development of the Iranian economy. The first chapter of this section examines the capacities of the Iranian economy, including natural resources, geography, industrial infrastructure, and labor force. The second chapter analyzes economic growth, inflation, unemployment and employment, investment and economic development in Iran. The third chapter is dedicated to poverty and inequality and examines changes in household expenditure levels, income distribution, poverty line and macroeconomic variables in Iran. Chapter four examines monetary, credit and exchange rate policies, including challenges and monetary policy instruments in Iran. The fifth chapter deals with fiscal policies, including fiscal policy and economic growth, fiscal policy and business cycles, fiscal policy stability, and fiscal policy challenges in Iran. Chapter six is devoted to the trading policies and trade instruments of Iran and their impact on economic growth in this country. In this chapter, the variables of Iran's foreign trade and Iran's position in world trade have been also examined. Chapter seven examines the labor market in Iran, including labor supply, labor demand, employment and unemployment, future scenario, medium- and the long-term situation in the Iranian labor market and implications of the future state of the Iranian labor market. Chapter eight has examined the financial market, including the development of the currency market, the development of the capital market, financial development and the nature of Iran's financial system. Chapter nine is devoted to economic liberalization, as well as theoretical foundations and basic concepts of the Iranian economy. Chapter 10 analyzes energy market reforms, descriptive statistics on the amount and consumption of energy subsidies, possible approaches to energy price reform, and the impact of rising energy prices on the government budget in Iran. Chapter 11 discusses the issue of privatization in Iran, including private sector development, the pathology of privatization in this country. It provides a framework for the future of privatization in the Iranian economy. The final chapter of this section is devoted to the developments in the selected countries, including the United Arab Emirates (UAE), Türkiye, China, Qatar, Iraq and Libya (mostly Iran’s foreign trade partners, except Libya), and the impacts of developments in these countries on the Iranian economy. This chapter also examines the impact of these developments in these countries on Iran's position in the oil market.

The third section of the book also consists of four chapters and is devoted to the global development of the Iranian economy. In the first chapter of this section, the globalization of the product market is examined. This chapter also discusses the combination of different sectors in world trade, global trade in natural resources, regional convergence treaties, as well as the experience of developing countries (including the UAE, China, East Asia, Latin America) and the factors influencing the choice of development strategy. The second chapter is dedicated to the globalization of the financial market. This chapter examines the evolution of globalization, the global definition of the financial sector, the importance of the financial sector to the world economy, factors affecting financial markets, types of external financing methods, foreign borrowing, foreign direct investment (FDI), as well as the performance of selected countries in the process of globalization, the financial globalization and economy of Iran. The third chapter  in this section focuses on developments in the global energy market, including trends in energy market changes, energy demand developments in different countries, as well as energy (oil and gas) supply. The final chapter explores the issue of regional cooperation, where the Eurozone, the G20, the Gulf Cooperation Council and the Economic Cooperation Organization (ECO) have been examined as case studies. This book comes to an end with a conclusion. However, it should be noted that each section and each chapter of this book have a separate introduction and summary.

As can be seen, according to this book, in addition to recognizing the main features of the Iranian economy in terms of the labor market, the financial market and the situation of poverty and income distribution, the main body of familiarity with the Iranian economy consists of various policy areas, including monetary, fiscal, currency and trade policies. This book is, in fact, a valuable book to analyze the situation of Iran's economy in a specific period of time and it can be considered one of the most authoritative books on Iran's economy.

This book provides a prominent picture of the capacities and performance of the Iranian economy, which has many potentials that distinguish it from many countries in the region and some countries of the world. The main advantages and capacities of Iran's economy can be summarized in the areas of natural resources, geographical capacities, industrial infrastructure and labor force. In addition, the study of this book shows that Iran has high potential, each of which, if properly exploited, can make a significant contribution to the achievement of balanced prosperity and comprehensive security. Establishing relationships among the main actors in the economy and ways of formulating economic policy could explain the size of the productivity and performance in Iran.

A study of this book shows that the performance of Iran's economy is in no way commensurate with its capacities. A high rate of inflation and unemployment, along with unstable economic growth, indicate the existence of fundamental problems in the system of equipping and allocating resources in this country. Whereas Iran has potential economic capacities that, if used correctly, could create much more favorable conditions for its economy.

Studying the main issues of challenging economic policies of Iran between 2001-2010 is one of the most important features of this book. During this period, as mentioned in the book, the changes applied in the energy market is one of the most important developments in the Iranian economy. In this decade, a large-scale jump in energy prices, the payment of cash subsidies people, and keeping the exchange rate and bank interest rates constant are the main characteristics of changes in the Iranian energy market under the heading of subsidy targeting. In addition, the attention of this book to global issues in general and to specific regions and countries, in particular, is another feature of this book. In this regard, as stated in this book, trade unions, agreements, regional and inter-state cooperation are important aspects of the current global situation, which have undoubtedly influenced the Iranian economy in various dimensions.

It is noteworthy to mention that this book is recommended for economists, government officials, policymakers, business activists, politicians, intellectuals, and academics to improve their knowledge of Iran's economy. Notably, it is recommended as a scientific source for teaching Iranian economics courses.

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