The Effect of Correcting The Fuel Price Gap on Economic Growth in Iran and Selected Contries

The Effect of Correcting The Fuel Price Gap on Economic Growth in Iran and Selected ContriesAbstractThe purpose of this study is to investigate the effects of fossil fuel subsidy reform on economic growth in Iran and several other countries. For this purpose, an endogenous growth model was specified and estimated using OLS Robust and Panel GMM methods, based on annual data in the surveyed countries in the period 2000-2018. The OLS Robust model, which analyzes the long-term effects, has been developed for the diesel product in three time periods: 2000-2018, 2000-2004, and 2005-2018. The results show that the fuel price gap variable increases in the mentioned three periods per unit of reduction in fuel subsidies by 5.53, 10.69 and 5.12 units of economic growth, respectively. In the GMM Panel model, which analyzes the short-term and medium-term effects, during the period 2000-2018, a one-unit increase in the price of diesel will increase economic growth by an average of 8.84 units.e results show that the fuel price gap variable increases in the mentioned three periods per unit of reduction in fuel subsidies by 5.53, 10.69 and 5.12 units of economic growth, respectively. In the GMM Panel model, which analyzes the short-term and medium-term effects, during the period 2000-2018, a one-unit increase in the price of diesel will increase economic growth by an average of 8.84 units.The Effect of Correcting The Fuel Price Gap on Economic Growth in Iran and Selected ContriesAbstractThe purpose of this study is to investigate the effects of fossil fuel subsidy reform on economic growth in Iran and several other countries. For this purpose, an endogenous growth model was specified and estimated using OLS Robust and Panel GMM methods, based on annual data in the surveyed countries in the period 2000-2018. The OLS Robust model, which analyzes the long-term effects, has been developed for the diesel product in three time periods: 2000