Comparing and Analyzing the Impact of Financial Development Indicators on Carbon Dioxide Emission during the Iranian Recession and Boom
Subject Areas : Environmental Economics
sara marashi aliabadi
1
,
fatemeh zandi
2
,
khalil saeidi
3
,
maryam lashkarizadeh
4
,
bijan safavi
5
1 - Ph.D. Student of Economics, Faculty of Economics and Accounting, Islamic Azad University, Tehran South Branch, Tehran, Iran
2 - Assistant Professor, Economics, Faculty of Economics and Accounting, Islamic Azad University, Tehran South Branch, Tehran, Iran * (Corresponding Author)
3 - Assistant Professor, Economics, Faculty of Economics and Accounting, Islamic Azad University, Tehran South Branch, Tehran, Iran.
4 - Assistant Professor, Economics, Faculty of Economics and Accounting, Islamic Azad University, Tehran South Branch, Tehran, Iran
5 - Assistant Professor, Economics, Faculty of Economics and Accounting, Islamic Azad University, Tehran South Branch, Tehran, Iran.
Keywords: Carbon dioxide, Recession and Boom, depth financial index, financial development efficiency index and fundamental financial development index,
Abstract :
Background and Objective: Protecting the environment and providing solutions to improve the quality of the environment has required countries to conduct studies to study the factors affecting the environment. One of these factors is the financial development of countries, because economists have considered financial development as an important factor influencing environmental preferences, which varies according to business cycles.Method: The present study uses Markov-Switching method and time series data over the period 1394-1349 (1970- 2015) the effects of financial development using depth financial index, financial development efficiency index (privy) and fundamental financial development index (bank) has studied the environment in the economic periods of the Iranian economy.Findings: In this regard, the economic periods of the Iranian economy are extracted using the Markov-Swichig model and then in the framework of econometric models using ARDL, the effects of recession and boom in the economy. The relationship with financial development on environmental quality has been examined.Discussion and Conclusion: The results show that liquidity (financial depth index), in conditions of economic boom and recession, has led to reduction of environmental pollution in the country. Private-sector facilities (financial development efficiency index) have a positive and significant impact on the environment in terms of boom conditions, but under recessionary conditions, private-sector facilities do not have a significant impact on environmental pollution. Finally, the creditworthiness of banks (the underlying indicator of financial development) increases pollution in times of boom, but in a recession has reduced environmental pollution.
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- Central Bank of Iran, statistics and data, database of economic time series.2007. bci.ir. (In Persain)
2. R.I. McKinnon, 1973.Money and capital in economic development .Washington, D.C.The Brookings Institution, pp. 177.index
- Rahmani, Timur, Macroeconomics, Baradaran Publications, 2000, Volume 2. (In Persian)
- IMF, International Monetrary Fund, data.imf.org
- A, Demirguc-Kunt and V, Maksimovic,1996. Stock Market Development and Financing Choices of Firms, World Bank Eonomic Review, 10(2), 341-69
- M, Lashkari zadeh .2018. The Impact of Boom and Recession on the Investment External direct in the environment (Markov-switching model approach). Modern Economics and Business, Institute of Humanities and Cultural Studies. 13(2): 143-166. (In Persian)
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8. A, Acheampong .2019. Modeling for insight: Does financial development improve environmental quality? Energy Economics. Available online 2 July 2019
- H, Liu, Y Song .2020. Financial development and carbon emissions in Chana since the recent world financial crisis: Evidence from a spatial-temporal analysis and a spatial Durbin model. Science of the Total Available online, 136771
- F, Khani, M, Hooshmand.2018. A Study of the Impact of Financial Development on Environmental Pollution of Selected Oil Exporting Countries with Emphasis on Good Democracy. Monetary, Financial Economics Research (Knowledge and Development) 25 (15): 158-133. (In Persain)
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