Analysis of Macroeconomic Factors Affecting Unemployment in Iran's Provinces: With Emphasis on Cost Credits and Acquisition of Capital Assets Ownership

Document Type : Original Article


1 Assistant Professor of Economics, Faculty of Economics and Political Sciences, Shahid Beheshti University

2 MA in Economics, Faculty of Economics and Political Sciences, Shahid Beheshti University

3 PhD Candidate in Economics, Faculty of Economics and Political Sciences Shahid Beheshti University


Unemployment is one of the major challenges facing the Iranian economy, and one of the government duties in the economy is to reduce unemployment. So, the aim of this paper is to study the macroeconomic factors affecting the unemployment rate in different provinces, with emphasis on cost credits and capital asset ownership during 2008-2015. The results indicate that cost credits have a significant positive effect and acquisition of capital assets have a significant negative effect on the unemployment rate in the provinces.With the increase in government cost credits, increased which has led to a reduction in productivity and an increase in unemployment. The increase in government acquisition of capital assets has had a complementary role for the private sector and has reduced the unemployment rate through providing the necessary economic infrastructure. Also, the results indicate a positive effect of the ratio of total government expenditures production of provinces on unemployment. With the division of provincial unemployment into urban and rural unemployment, cost credits has had a significant positive effect on unemployment, but the effect of acquisition of capital assets on rural unemployment is not significant. Also, during the implementation of “targeted subsidies law”, the unemployment rate has increased.


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