The Impact of Tariff Rates in the Industry Sector on the Households Welfare in Iran, with Emphasizing the Role of the Resistance Economy

The purpose of this paper is to investigate the effect of the industry sector tariff rate changes on the Iranian households’ welfare under the conditions of the resistance economy. To achieve this goal, based on Samadi et al.'s (2019) survey, the computable general equilibrium model of Decallo et al. (2013) has been adjusted. After making the adjustments, using the adjusted social accounting matrix of 2011 and GAMS software, the equations were solved and analyzed in the form of three scenarios. The findings show that in the first scenario, without assuming the implementation of the notified policies of the resistance economy, the reduction of tariff rate in all sectors of industry causes the level of households’ welfare will become negative. In the second scenario, assuming the implementation of the notified policies of the resistance economy, welfare in all sectors of industry except medium-tech industries is positive and its trend is descending in all sectors except high-tech industries. In the third scenario, assuming the strengthening of social and institutional factors, welfare in all sectors is positive and its trend is upward in medium and high-tech industries and downward in low-tech industries. Therefore, the reduction of tariff rate is recommended only in the high-tech industries if the notified policies of resistance economy are implemented.