Direct Distribution of Rents and the Resource Curse in Iran: A Micro-Econometric Analysis

22 Pages Posted: 3 Jul 2014

See all articles by Mohammad Reza Farzanegan

Mohammad Reza Farzanegan

University of Marburg - Center for Near and Middle Eastern Studies (CNMS)

Mohammad Habibpour

Philipps-University of Marburg - Center for Near and Middle Eastern Studies (CNMS)

Date Written: June 11, 2014

Abstract

Our goal is to examine the income inequality and welfare effects of the direct distribution of resource rents and subsequent taxation in Iran. We use rich micro survey data covering more than 36,000 Iranian households in 2009. Our micro-simulations show that the direct distribution of resource rents among all citizens and the imposition of an additional direct income tax have a significant negative effect on the household GINI index and on poverty. We also examine three alternative policies to the resource dividend (RD) policy. The results show that the RD policy is the most successful policy for addressing rents-induced inequality.

Keywords: resource curse, direct rents distribution, poverty, inequality, household survey, Iran.

JEL Classification: Q320, Q380, Q430, I300, C150

Suggested Citation

Farzanegan, Mohammad Reza and Habibpour, Mohammad, Direct Distribution of Rents and the Resource Curse in Iran: A Micro-Econometric Analysis (June 11, 2014). CESifo Working Paper Series No. 4824, Available at SSRN: https://ssrn.com/abstract=2461645

Mohammad Reza Farzanegan (Contact Author)

University of Marburg - Center for Near and Middle Eastern Studies (CNMS) ( email )

Deutschhausstra├če 12
Marburg, 35037
Germany

HOME PAGE: http://www.uni-marburg.de/cnms/wirtschaft

Mohammad Habibpour

Philipps-University of Marburg - Center for Near and Middle Eastern Studies (CNMS) ( email )

Universit├Ątsstrasse 24
D-35032 Marburg, D-35032
Germany

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