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Capital Stock Simulation by Hartwick Rule in Iran

Author

Listed:
  • Saleh Ghavidel

    (Department of Economic, Firoozkooh Branch, Islamic Azad University, Firoozkooh)

  • MAHMOUD MAHMOUDZADEH

    (Department of Economic, Firoozkooh Branch, Islamic Azad University, Firoozkooh)

  • MIR HOSEIN MOUSAVI

    (ALZAHRA UNIVERSITY)

  • ELHAM BERIMANI

    (Department of Economic, Firoozkooh Branch, Islamic Azad University, Firoozkooh)

Abstract

Fully reinvest of natural resource rents in foreign assets or productive capital such as buildings, roads, machines, human capital or health so-called Hartwick rule. The aim of this paper is to estimate the capital stock in Iran by Hartwick Rule. In other word we estimate PIM method and Hartwick rule for calculate capital stock. The result show that estimated capital stock by Hartwick rule is more than PIM method. Therefore, in Iranian economy, Hartwick rule is not applied because part of natural resource income consumed and genuine saving is negative. If the Hartwick rule would have been followed during the last few decades, Iranian economy would have been much less dependent on oil and other resources.

Suggested Citation

  • Saleh Ghavidel & MAHMOUD MAHMOUDZADEH & MIR HOSEIN MOUSAVI & ELHAM BERIMANI, 2015. "Capital Stock Simulation by Hartwick Rule in Iran," Proceedings of International Academic Conferences 2804577, International Institute of Social and Economic Sciences.
    • Handle: RePEc:sek:iacpro:2804577
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    File URL: https://iises.net/proceedings/19th-international-academic-conference-florence/table-of-content/detail?cid=28&iid=050&rid=4577
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    More about this item

    Keywords

    Hartwick rule; Natural resource; PIM method; Genuine saving;
    All these keywords.

    JEL classification:

    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources
    • N50 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - General, International, or Comparative
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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