Macroeconomic Instability, Autoregressive Distributed Lag Model, Gelzakas Index, Economic Welfare, Iran. (in Persian)

Macroeconomic instability refers to fluctuations in the economy that can be caused by factors such as inflation, recession, and exchange rate fluctuations. The most important goals of any country are to create stability in all dimensions. The issue of welfare is also one of the most important issues of different societies. In recent years, we have witnessed a decline in Iran's position in various welfare rankings. Therefore, given such importance, the main goal of the present study is to examine the effect of macroeconomic instability on economic welfare in Iran in the period from 1978 to 2022. For this purpose, according to two macroeconomic instability indices (ARCH-GARCH, Gelzakas), an autoregressive approach with distributional lags was used in estimating the two models of the research model. The results of the data description show that the average economic welfare in Iran was 40.3 (out of 100) and its highest value was related to the Fifth Development Plan. Also, the highest average among the instability indices was related to Gelzakas with a figure of 0.46 percent. The results of the study show that instability based on both indices (ARCH-GARCH and Gelzakas) has a negative effect on economic welfare in the short and long term. Also, the results show that economic growth and per capita income have a positive effect on economic welfare in the short and long term, as expected. According to other results, inflation and unemployment rate have an adverse effect on economic welfare. In this study, it is suggested that economic policymakers, to increase the level of economic welfare in Iran, government policies should be aimed at reducing fluctuations in instability variables as much as possible.