Why political connections are driving business confidence in MENA
This column reports the findings of a new study of how the political ties of firms in the Middle East and North Africa boost business confidence. The research suggests that this optimism is primarily driven by networked access to credit and lobbying, underscoring the need for greater transparency and institutional reform in corporate governance.
Sanctions and the shrinking size of Iran’s middle class
International sanctions imposed on Iran from 2012 have reduced the size of the country’s middle class, according to new research summarised in this column. The findings highlight the profound social consequences of economic pressure, not least given the crucial role of that segment of society for national innovation, growth and stability. The study underscores the need for policies to safeguard the civilian population in countries targeted by sanctions.
Losing the key to joy: how oil rents undermine patience and economic growth
How does reliance on oil revenues shape economic behaviour worldwide? This column reports new research showing that oil rents weaken governance, eroding patience – a key driver of economic growth and, according to the 13th century Persian poet Rumi, ‘the key to joy’. Policy measures to counter the damage include enhancing transparency in oil revenue management, strengthening independent oversight institutions and ensuring that sovereign wealth funds have robust rules of governance.
Economic consequences of the 2003 Bam earthquake in Iran
Over the decades, Iran has faced numerous devastating natural disasters, including the deadly 2003 Bam earthquake. This column reports evidence on the unexpected economic boost in Bam County and its neighbours after the disaster – the result of a variety of factors, including national and international aid, political mobilisation and the region’s cultural significance. Using data on the intensity of night-time lights in a geographical area, the research reveals how disaster recovery may lead to a surprising economic rebound.
Sanctions and energy efficiency in Iran’s industries
What is the effect of economic sanctions on the energy efficiency of Iran’s industries? This column reports the findings of new research, which examines the impact of sanction intensity within industrial sub-sectors of the Iranian economy on their energy efficiency.
Corruption in Iran: the role of oil rents
How do fluctuations in oil rents influence levels of corruption in Iran? This column reports the findings of new research, which examines the impact of increases in the country’s oil revenues on corruption, including the mechanisms through which the effects occur – higher inflation, greater public spending on the military and the weakness of democratic institutions.
Economic roots of early marriage in Iran
Despite the documented harms of being married off before the age of 18, particularly for girls, early marriage remains common in parts of Iran. This column summarises research that sheds light on the economic factors that drive this practice, using unique provincial data to show that poverty, inflation and income inequality are key determinants –while religiosity is not. The findings suggest that economic policies can play a crucial role in reducing the prevalence of child marriage.
Natural disaster literacy in Iran: survey evidence from Tehran
The frequent floods, earthquakes, and heat waves in the Middle East and North Africa underscore the urgent need to assess the region's preparedness for natural disasters. This column summarizes the state of 'natural disaster literacy' in various parts of Tehran, the capital of Iran and one of the most populous metropolitan areas in MENA. Data from a survey conducted in the winter of 2020/21 enabled the development of a disaster literacy index, which helps to identify the city's most vulnerable districts.
Sanctions and carbon emissions in Iran
How are Iran’s energy use and emissions of carbon dioxide affected by the imposition of economic sanctions? This column summarises new research that analyses a range of different scenarios and which takes account of multiple economic, social and environmental dimensions, notably what happens to growth and energy intensity, and whether sanctions are lifted.
Iran’s globalisation and Saudi Arabia’s defence budget
How might Saudi Arabia react to Iran's renewed participation in global trade and investment? This column explores whether the expanding economic globalisation of Iran, following the lifting of nuclear sanctions, could yield a peace dividend for Saudi Arabia, consequently dampening the Middle East arms competition. These issues have attracted increased attention in recent times, notably after a pivotal agreement between the two countries in March 2023, marking the resumption of their political ties after a seven-year conflict.
Egypt and Iraq: amenities, environmental quality and taste for revolution
The Middle East and North Africa is a region marked by significant political turbulence. This column explores a novel dimension of these upheavals: the relationship between people’s satisfaction with, on one hand, the amenities to which they have access and the environmental quality they experience, and, on the other hand, their inclination towards revolutionary actions. The data come from the World Value Survey collected in 2018 in Egypt and Iraq.
The human toll: Assessing the damage caused by revolution and war in Iran
Wars and revolutions have a notable effect on several socio-economic metrics, including life expectancy. Measuring these impacts is not always straightforward. This column presents new findings from a study on Iran, using a counterfactual scenario to estimate how the Islamic Revolution and subsequent war with Iraq affected life outcomes for Iranians. The effects are substantial, with the combination of the regime change and conflict that followed leading to a five-year fall in average life expectancy. In other words, had there been no revolution and war, the life expectancy of an average Iranian would have been half a decade longer.
The impact of revolution and war on income inequality in Iran
How did Iran’s revolution of 1978-79 and the war with Iraq from 1980 to 1988 affect levels of income inequality levels in the country? Would income inequality have developed differently in Iran if the revolution and war had never occurred? And how significant were the effects of the revolution and war in reducing income inequality? This column reports new research findings on these questions.
How business survives under sanctions: the experience of Iranian firms
How have firms in Iran responded to the international economic sanctions against the country? This column reports evidence on the operational strategies used by micro, small and medium-sized enterprises to increase their chances of survival.
Corruption and internal conflict in Iran
To what extent does increased corruption in a country lead to greater levels of internal conflict in the form of riots, strikes and anti-government demonstrations? This column reports new evidence from Iran over the past 60 years.
Air pollution and internal migration in Iran
The quality of the local environment can have a significant impact on residents’ decisions about whether to migrate to another part of the country. This column reports research showing that Iranian provinces with higher levels of air pollution experience increased net outmigration. Policy-makers seeking to reduce internal migration could focus more on environmental projects, addressing the factors that contribute to the degradation of air quality, particularly in the most polluted areas.
Oil price shocks, protest and the shadow economy
Can negative oil price shocks raise the risk of internal conflict in oil-dependent economies? Not really: as this column reports, evidence from 144 countries over the period 1991-2015 indicates that the destructive effects are mitigated when informal activities are a bigger part of the whole economy. The results imply the helpful role of the shadow economy in keeping political systems stable under rising economic pressures.
Experiencing the Iran-Iraq war: effects on later life views on defence
Iranians experienced a destructive eight-years war with Iraq between 1980 and 1988, which together with the Islamic Revolution resulted in significant economic costs. This column reports new research that examines individuals’ experiences of the Iran-Iraq war during early adulthood (18-25 years) and the impact on their preference for strong national defence forces.
Oil rents and Iran’s middle class
Iran’s middle class has experienced persistent expansion over the past 50 years, excluding the period coinciding with revolutionary turmoil and the Iran-Iraq war. As this column explains, the growth of the middle class has been significantly influenced by oil revenues acting to expand non-oil trade, the service sector and the real estate sector. But growth has not been accompanied by improvements in the quality of political institutions.