Balassa?Samuelson Effect in Iran

Saleh Ghavidel (), Mahmoud Mahmoudzadeh () and Hamideh Radfar ()
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Saleh Ghavidel: Firoozkooh Branch, Islamic Azad University, Firoozkooh, Iran
Mahmoud Mahmoudzadeh: Firoozkooh Branch, Islamic Azad University, Firoozkooh, Iran
Hamideh Radfar: Firoozkooh Branch, Islamic Azad University, Firoozkooh, Iran

No 701692, Proceedings of International Academic Conferences from International Institute of Social and Economic Sciences

Abstract: Deviations from purchasing power parity because a deviation of productivity is Balassa?Samuelson effect. The Balassa?Samuelson effect depends on inter-country differences in the relative productivity of the tradable and non-tradable sectors. According to this hypothesis, Imai (2010) make a model and measurement Balassa?Samuelson effect in Japan during 1970-1955 when exchange rate in Japan is fixed. In this paper we measurement Balassa?Samuelson effect in Iran economic. The result shows that Balassa?Samuelson effect in Iran is -2.1. Then devaluation of the national currency in Iran according to Balassa?Samuelson effect would be equal to 2.1 in annual, while devaluation of the national currency in Iran 13% in a year.

Keywords: Balassa?Samuelson effect; purchasing power parity; productivity gap; tradable and non-tradable sectors (search for similar items in EconPapers)
JEL-codes: D24 E31 F31 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2014-10
New Economics Papers: this item is included in nep-ara, nep-cwa, nep-mac and nep-opm
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Published in Proceedings of the Proceedings of the 12th International Academic Conference, Prague, Oct 2014, pages 452-463

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Persistent link: https://EconPapers.repec.org/RePEc:sek:iacpro:0701692

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