An analysis of the effects of credit policies on investment in major economic sectors

Ahmad Tashkini


The aim of this research is to analyze economic effects of credit policies on major economic sectors in Iran’s Economy, emphasizing on industry and mining sectors.  To do so, we employed three methodological approaches: descriptive statistical analysis of macroeconomic data; taking expert opinions; and an econometric system of equations using the seemingly unrelated regression method for annual data in the period 1973-2012. Our results show that especially in manufacturing sectors, rather than loan interest rates, “amount of loans” has a crucial role in encouraging investment decisions. Also, we found that imports of capital goods as a channel of foreign technology transmission to the home country has an important role in investment decisions, especially in Iranian industry and mining sectors. Finally using descriptive statistical analysis we found that increasing “availability of loans” is more effective than administrative control of interest rates in encouraging investment decisions.


Investment, Credit Policy, industry and mining Sector, Agriculture Sector.

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