Evaluation of Bank Oriented Environmental Social Responsibility in Order To Reduce Emissions in Industrial Production and Macroeconomic Levels in Iran: Application of Blanchard-Quah Decomposition (BQ) and Bootstrap Standard Error (BSE)

Subject Areas : Environmental Economics

mahdi ghaemiasl ¹ , Mohammad Nasr Isfahani ² , Sirus Charkh ³

1 - Assistant Professor, Economics and Islamic Banking Department, Economics Faculty, Kharazmi University, Tehran, Iran. *(Corresponding author)
2 - Tutor, Economics and Islamic Banking Department, Economics Faculty, Kharazmi University, Tehran, Iran.
3 - M.A, Islamic Banking, Economics and Islamic Banking Department, Economics Faculty, Kharazmi University, Tehran, Iran.

Received: 2016-12-23 Accepted : 2017-08-09 Published : 2020-01-21

Keywords: non-usury banking system, Environmental social responsibility, Blanchard-Quah Decomposition,

Abstract :

Background and Objective: Environmental responsibility as an important aspect of social responsibility is a necessary condition for survival and success ban and banks are trying to invest in activities that can improve the conditions of society and protecting the environment. The aim of this study was to evaluate suppliers based bank's environmental social responsibility to reduce emissions in both industrial and macroeconomic production levels. Method: In this study to investigate the contemporaneous, long-run and dynamic effects of facilities granted by the banking system to the private sector on the emission of environmental pollutants at two levels of industrial production (industry sector) and aggregated economic activities (macroeconomic), the structural VAR method (SVAR), Bootstrap Standard Error (BSE) and Blanchard-Quah Decomposition (BQ) is used. Findings: The results of contemporaneous and long-term effect matrixes in macroeconomic SVAR model shows that, A financial shock (with the size of a standard deviation) due to Bank support facilities to aggregated economic activities and from disturbance term of DLTLOA, led to a 0.0387 percent increase in the level of environmental emissions in the first period, but in the long run has no significant effect on the level of emissions. In addition, the result of industrial sector shows that a financial shock, led to a 0.0397 percent increase in the level of environmental emissions in the first period and its long-term impact on the level of environmental emissions is 0.0695 percent incensement. Estimation of dynamic effects also shows that in both industrial sector and the macroeconomic level, all shocks led to emissions incensement. Discussion and Conclusion: The banking sector with the support of sectors of the economy, especially the industrial sector, has failed to play proper role in its serious social responsibility in the area of production with clean technology and methods and in practice, has become financial supporter of unqualified pollutant industries and productions. It seems as improper support structure of the banking system from industries and pollutant producers, to be followed by increasing in environmental emissions, the reform of the banking support structure and facilities, can lead to environmental improvements.

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