Macro-critical dynamics in the Iranian economy: An empirical analysis

This thesis aims to analyze the relationships between key macroeconomic indicators in the Iranian economy from a theoretical and empirical perspective. The study aims to make original contributions by addressing the multifaceted interactions between growth, income distribution, unemployment, the Barro-Hanke Poverty Index, inflation, interest rates, current account deficit, and oil prices in an economy like Iran, which is highly dependent on energy revenues, has structural vulnerabilities, and has been subject to international sanctions for many years. Within the scope of the thesis, using annual data for the period 1990-2023, the stationarity levels of the variables were first analyzed with ADF and LM tests. Then, cointegration relationships among variables are investigated, and short- and long-run effects are revealed through Granger causality analyses. Empirical findings show that the Barro-Hanke Poverty Index is significantly affected by the current account deficit, income distribution, interest rate, and oil prices, while inflation has causal relationships with the Barro-Hanke Index, Gini coefficient, oil prices, and the current account deficit. While growth is explained only by the Barro-Hanke Index, interest rate, current account deficit, and unemployment variables are not causally affected in the model. In line with the results obtained, it is emphasized that macroeconomic imbalances in Iran should be addressed not only with classical monetary and fiscal policies but also with social welfare policies, reforms in the energy sector and economic diversification strategies. By linking multidimensional poverty measures, social justice, and economic vulnerabilities, the thesis aims to contribute not only to the academic literature but also to policy-making processes.