Examining the Reaction of Economic Complexities to Financial Stress Impulse, a Case Study of Iran

Subject Areas : Financial Knowledge of Securities Analysis

abolfazl  shahabadi ¹ (Economics Faculty of Social Sciences and Economics, Alzahra University, Tehran, Iran)
ثمینه  gh ² (Postdoctoral researcher, Alzahra University)

Received: 2022-10-16 Accepted : 2023-01-12 Published : 2023-10-23

Keywords: Financial Stress, Knowledge-based economy, Economic Complexity Index, Bayesian Approach,

Abstract :

By studying financial crises and stress in recent years, especially in Iran, and its rapid spread and transfer to the economy, it can be seen that the effects of financial stress on macro variables in the field of knowledge-based economy have been given less attention. Therefore, the aim of this research is to estimate the response of macro variables related to the field of the knowledge economy (economic complexity index) in the face of financial stress shocks in Iran. In order to achieve this goal, the effects of systemic financial stress shocks on economic complexity and its determinants, including foreign direct investment, are evaluated during the period of 2017-2018 with the help of the Bayesian autoregression approach. The results of the study show It shows that the investigated variables, including economic complexity and foreign direct investment, react negatively to financial stress shocks in the long term, and their reaction is dampened over time.

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