The role of political and economic uncertainties on improving the predictability of industrial activities in Iran

Subject Areas : Computational economics

Farzaneh Khalili ¹ , mehdi mohammadi ² , farid asgari ³

1 - Department of economic, Abhar branch, Islamic Azad university, Abhar, Iran.
2 - Department of economic, Abhar branch, Islamic Azad university, Abhar, Iran.
3 - Department of economic, Abhar branch, Islamic Azad university, Abhar, Iran.

Received: 2022-03-17 Accepted : 2022-06-18 Published : 2022-11-22

Keywords: Economic uncertainty, , , , political uncertainty, , industry sector, , predictability,

Abstract :

The industrial sector and its growth is one of the most important performance indicators of the economy at the macro level and achieving a higher growth rate in this sector is one of the important goals of any economic system. Therefore, it is important to study the factors that affect the development of the industrial sector and improve the predictability of this sector. A review of the literature on the development of industry in the economy shows that one of the most important factors affecting its development is the stability of macroeconomics in both economic and political sectors, so that economists today have accepted that economic and political stability is a necessary condition for growth. It is high and continuous in the industry sector of the economy. In this regard, in the present study, the role of political and economic uncertainties on improving the predictability of industrial sector activities in Iran during the period 1991 to 1399 has been investigated. GMM generalized torque method was used to analyze the data. Findings showed that economic and political uncertainties have had negative and significant effects on the development of the industrial sector in Iran. It was also observed that considering political and economic uncertainties can improve the predictability of industrial sector activities. Accordingly, it is concluded that macroeconomic and policy policies in the country should be implemented a way that does not harm economic stability and thus the development of the industrial in the country.