https://jep.sbu.ac.ir/ International Journal of New Political Economy en daily 1 Sat, 01 Aug 2026 00:00:00 +0330 Sat, 01 Aug 2026 00:00:00 +0330 https://jep.sbu.ac.ir/article_107075.html Income inequality has been widely recognized as one of the most pressing socio-economic challenges for policymakers around the world. Strong democratic institutions may contribute to a more equitable distribution of income by promoting transparency and guaranteeing accountability. This study investigates the predictive causality and long-term relationship between democracy, governance, and inequality across three country income groups: high-income, middle-income, and low-income, using data from 2006 to 2023. The analysis employs Panel co-integration, FMOLS and DOLS methodology, the Dumitrescu-Hurlin (2012) panel causality test, Pooled Mean Group regression and regression with Driscoll-Kraay standard errors. The Dumitrescu–Hurlin test suggests bidirectional predictive causality between democracy and inequality. However, these findings should be interpreted as statistical predictability rather than structural causation. Furthermore, long-term regression results (FMOLS and DOLS) reveal substantial heterogeneity across income groups. Specifically, democracy variable is associated with lower income inequality in high-income economies, whereas its effect appears positive in middle- and low-income economies. https://jep.sbu.ac.ir/article_107076.html This study employs a fuzzy logic-based approach to estimate the impact of uncertainty in key sustainability-related sectors—namely water, energy, waste, greenhouse gas (GHG) emissions, and debt-to-capital ratio—on return on investment (ROI) over the period from 1993 to 2024. Given the inherently imprecise and dynamic nature of environmental and financial variables, fuzzy logic provides a robust framework to model vagueness and ambiguity in data. The analysis integrates longitudinal data across global markets, incorporating fuzzy sets to represent uncertain input variables and their nonlinear relationships with ROI. Results indicate that increased uncertainty in water and energy usage, as well as higher GHG emissions and waste production, negatively influence ROI, particularly when coupled with elevated debt-to-capital ratios. However, the application of sustainable practices that reduce these uncertainties can lead to more stable and higher investment returns. The findings offer strategic insights for investors and policymakers aiming to balance economic performance with environmental and financial risks. They also highlight the importance of investments needed to meet regulatory requirements, which are the main drivers for organizations at the financial level. https://jep.sbu.ac.ir/article_107106.html This article examines how the digitalisation of the global economy, particularly within the Fourth Industrial Revolution, reshapes the meaning and exercise of state sovereignty in international politics. It asks how sovereign authority is reorganised through digital infrastructures, cross-border data flows, platform governance, cloud systems, technical standards, and transnational regulatory networks. The article adopts a qualitative, conceptual, and descriptive-analytical approach informed by network theory, and synthesises debates on digital sovereignty, infrastructural power, platform authority, data governance, fiscal sovereignty, digital taxation, and networked interdependence. It argues that digitalisation neither eliminates sovereignty nor leaves its classical territorial model intact. Rather, sovereignty is reassembled as a multi-layered networked capacity operating across infrastructural, rules-and-institutions, and legitimacy layers. The analysis shows that digitalisation can strengthen state capacity through regulation, public service delivery, cybersecurity, taxation, and infrastructure-building, while deepening dependence on private platforms, foreign cloud providers, external standards, payment infrastructures, and cross-border data regimes. Effective sovereignty in the digital economy therefore depends on states’ ability to secure critical infrastructures, shape rules and standards, manage platform power, diversify strategic dependencies, and sustain legitimacy across domestic and international arenas while preserving accountability and rights in digital governance. https://jep.sbu.ac.ir/article_107154.html International trade is a key driver of contemporary economic development, and the effective implementation of trade agreements is essential for maximizing national benefits. Among the critical mechanisms in preferential trade agreements are the rules of Origin[1], which determines whether exported goods qualify for reduced or zero tariffs. This study investigates the role of ROO and evaluates the extent to which agricultural exporters benefit from preferential tariff advantages in selected markets. The research combines documentary and library analysis with a field survey. Data were collected in 2025 using 200 researcher-designed questionnaires completed with the cooperation of the Iran Chamber of Commerce and its provincial branches. The target population included agricultural exporters to the Eurasian, Turkish, and Pakistani markets. Findings indicate that only 20.5% of exporters utilized preferential tariffs through certificates of origin[2]. Approximately 79% identified limited awareness, insufficient information dissemination, administrative bureaucracy, and time-consuming procedures as major barriers. Statistical analysis revealed significant relationships between awareness and gender, as well as between benefit utilization and educational level. Exporters trading in the Eurasian market reported higher satisfaction than those targeting other markets. The study concludes that expanding targeted training programs and improving information systems—especially regarding certificate issuance—are effective strategies to enhance utilization of ROO. Accordingly, it is recommended that the Trade Promotion Organization of Iran, in collaboration with the Iran Chamber of Commerce and its provincial branches, organize short-term, practical workshops for stakeholders. These initiatives would facilitate access to preferential export markets and maximize the benefits derived from ROO. https://jep.sbu.ac.ir/article_107166.html In today's complex and changing business world, audit quality is recognized as one of the fundamental pillars in ensuring the accuracy and transparency of companies' financial information. Narcissism, as a personality trait, can affect the decision-making and professional behavior of auditors. This trait may cause auditors to be less careful in assessing risks and identifying weaknesses in financial reports. On the other hand, auditor's industry expertise and audit fees can also act as moderating factors in this regard. Therefore, the main purpose of the present study is to examine the effect of partner narcissism on audit quality with regard to the moderating role of auditor's industry expertise and auditor fees. A total of 104 companies were selected as a statistical sample using a systematic exclusion method. The time period of this study is a 7-year period from the beginning of 2016 to the end of 2022. The website of the Stock Exchange and the new Rahavard software were used to collect data, and then the collected data were analyzed using the Eviews software, and the results showed that the narcissism of the audit partner does not have a significant effect on the quality of the company's audit. The auditor's expertise in the industry positively moderates the effect of the narcissism of the audit partner on the quality of the company's audit. However, the auditor's fee does not moderate the effect of the narcissism of the audit partner on the quality of the company's audit. Given the importance of this issue in improving audit processes and increasing the credibility of financial reports, this research can help managers, auditors, and policymakers to have a better understanding of the factors affecting audit quality and provide appropriate solutions to improve it. https://jep.sbu.ac.ir/article_107279.html This study examines how economic diplomacy supports the transition of rentier economies toward sustainable development, emphasizing its importance for policymakers and scholars interested in the future trajectories of Gulf states. The objective is to explain how two Gulf rentier states with similar diversification goals have adopted different patterns of state behavior as they move beyond rentier dependency. The study adopts a comparative-exploratory design based on document analysis, a review of political economy literature, and descriptive analysis of FDI data. The findings show that the UAE has developed a facilitative, market-oriented model characterized by regulatory flexibility, free zones, legal predictability, global connectivity, and public-private risk sharing. Saudi Arabia, by contrast, follows a centralized, state-engineered, project-centered model led by sovereign institutions such as the Public Investment Fund (PIF) and large-scale initiatives such as Vision 2030 and NEOM. The article argues that successful post-rentier transition depends less on the scale of megaprojects than on the accumulation of institutional capital, including transparency, the rule of law, regulatory credibility, adaptive governance, and private-sector empowerment. The study concludes that sustainable development in the Gulf requires a gradual shift toward institutional equilibrium, in which state capacity, market participation, and credible regulatory frameworks jointly support long-term diversification and resilience. https://jep.sbu.ac.ir/article_107291.html This study employs the Panel Smooth Transition Regression (PSTR) framework to analyze how financial inclusion indirectly shapes tax revenue across 50 countries (28 developing, 22 developed) during 2004–2024. A financial inclusion index, constructed via Principal Component Analysis (PCA) using ATM density, bank branch penetration, and outstanding deposits, serves as the transition variable. Results confirm non-linear relationships between financial inclusion, tariff structures, financial development, institutional quality, economic growth, and tax revenue. For developing nations, the threshold is 4.2240 with slope 2.1008. In Regime 1, bank branches show negative effects (-0.2166), while financial development is positive (0.2849). Beyond the threshold, bank branches remain negative (-0.0626), financial development positive (0.0573), and institutional quality turns favorable (0.0660). For developed economies, threshold is 6.7464 with slope 2.1993×10⁴. In Regime 1, bank branches are negative (-0.0502) while tariffs are positive (0.0516). In Regime 2, bank branches become positive (0.0077), financial development turns negative (-0.0853), institutional quality becomes strongly negative (-1.1205), and economic growth positive (0.4496). Granger causality tests reveal bidirectional relationships in developing countries, while developed nations show unidirectional causality from tax revenue to financial inclusion. Findings underscore that financial inclusion's influence on tax revenue is non-linear and context-specific. Policy recommendations include strengthening digital financial infrastructure in developing economies and implementing regulatory frameworks to prevent excessive inclusion in developed countries. https://jep.sbu.ac.ir/article_107306.html This research investigates whether fluctuations in economic policy uncertainty (EPU) are reflected in the volatility behavior of the Tehran Stock Exchange (TSE). Using daily market information from January 2, 2015, to September 23, 2025, along with observations from 183 listed firms, the study develops an empirical framework to evaluate the interaction between uncertainty conditions and equity market performance. The analysis combines several econometric procedures, including ARCH diagnostics, GARCH-based volatility estimation, and GLS regression with an AR(1) adjustment, to identify the characteristics of market volatility and assess the role of EPU. The empirical evidence indicates substantial variability in the TSE index and confirms the existence of time-dependent variance behavior and persistent volatility effects, supporting the use of GARCH specifications. The results show that earlier market disturbances contain significant information for explaining future volatility movements. Furthermore, the estimated GLS model suggests that changes in EPU are associated with a statistically meaningful inverse effect on the dependent variable (coefficient = -0.3451; p-value = 0.0262), providing support for the research hypothesis. The analysis of the Sharpe Ratio also reveals differences in risk-adjusted outcomes across periods characterized by varying uncertainty levels. By focusing on an emerging financial market exposed to repeated policy changes, this study contributes empirical evidence on the interaction between uncertainty conditions and market volatility. The findings suggest that improving policy predictability, monitoring uncertainty indicators, and incorporating uncertainty measures into financial decision processes may help market participants better manage risk exposure. https://jep.sbu.ac.ir/article_107315.html This paper examines how nuclear-related sanctions have shaped an adaptive political economy in Iran. While existing research has documented the macroeconomic, welfare, and financial consequences of sanctions and assessed their coercive effectiveness, less attention has been paid to the mechanisms through which sanctions-generated pressure is absorbed, redistributed, and reorganized within the target economy. Addressing this gap, the paper develops an endogenous-equilibrium perspective that treats sanctions as forces reshaping domestic institutions, firm behavior, household adjustment, and transnational commercial networks. The study employs theory-guided structured comparison and mechanism tracing across three episodes: the 2006–2013 multilateral sanctions regime, the 2015–2016 JCPOA implementation period, and the post-2018 maximum-pressure campaign. It triangulates macroeconomic, welfare, firm-level, financial-market, trade, and labor-market evidence. The analysis identifies four interrelated mechanisms: macroeconomic contraction, reallocation of access to scarce resources, institutional adaptation, and sanctions-induced uncertainty. The findings show that sanctions imposed severe costs, including output losses, weaker investment, exchange-rate instability, erosion of the middle class, and greater labor-market vulnerability. Yet these costs were distributed unevenly. Scarcity increased the value of access to finance, foreign exchange, imports, institutional coordination, and external commercial networks. Better-connected firms adapted through liquidity management, supply-chain restructuring, alternative payments, and trade rerouting, whereas less-connected firms and households bore disproportionate costs. The paper concludes that repeated sanctions generated a constrained and unequal adaptive equilibrium in which external pressure became embedded in domestic institutions, business strategies, and expectations. It contributes to sanctions research by showing that long-term outcomes depend not only on pressure intensity but also on the mechanisms through which pressure is mediated and sustained. https://jep.sbu.ac.ir/article_107317.html This study investigates the impact of digital financial inclusion and green energy adoption on household health outcomes in Nigeria using ordered logit and logit regression as robustness check models. The ordered logit results reveal that age and household size significantly influence health outcomes, with larger households and older populations facing higher risks. Income and urban residence provide protective effects under mild conditions but lose significance under severe health shocks, highlighting socioeconomic disparities. Green energy adoption, particularly liquid natural gas (LNG), is consistently associated with reduced probabilities of adverse health outcomes, underscoring its role in mitigating indoor air pollution and respiratory illnesses. Conversely, reliance on electric stoves shows mixed effects, reflecting infrastructural challenges in electricity supply. Digital financial inclusion demonstrates nuanced effects. Mobile phone ownership emerges as a robust determinant of improved health outcomes, facilitating access to health information and financial tools. Mobile banking reduces moderate health risks but is positively associated with severe outcomes, suggesting its role as a coping mechanism during crises. Account ownership alone shows limited effects, indicating that access must be paired with effective utilization. The composite measure of digital finance and green energy adoption highlights the synergistic benefits of integrating financial and energy policies to enhance household resilience. Clean energy adoption directly reduces environmental health risks, while digital financial inclusion enhances resilience against shocks. Policy interventions should therefore prioritize expanding LNG adoption, strengthening digital connectivity, and integrating financial services with health systems to achieve sustainable improvements in household welfare. https://jep.sbu.ac.ir/article_107335.html This study investigates the nonlinear and regime-dependent relationship and causal link between financial stress in ASEAN+3 economies and global commodity price fluctuations over the period 1995:1–2023:8, using the Markov-Switching Vector Error Correction Model MSIA(2)-VECM(7). The model allows the identification of distinct behaviors during economic expansions and recessions, with Regime 1 representing the boom phase and Regime 2 the recession phase.Empirical findings reveal that during expansionary periods, there is a significant one-way causal relationship in which changes in commodity prices lead to financial stress, indicating limited external price influence. In contrast, during recessions, a significant two-way causal relationship is observed: increases in global commodity prices exacerbate financial stress, while financial stress shocks—through effects on production costs, investment, global demand, and exchange rates—in turn affect commodity prices. Lagged financial stress exhibits self-reinforcing and self-correcting mechanisms, reflecting the effectiveness of targeted policy interventions such as liquidity injections, monetary easing, and fiscal support in restoring stability.Analysis of regime transition probabilities demonstrates that the boom regime is more stable and persistent than the recession regime, emphasizing the importance of regime-specific policy measures. Based on these results, policymakers should prioritize stabilizing interventions during downturns, continuously monitor commodity price trends, and enhance economic resilience through trade diversification and improved trade balances to mitigate the asymmetric impact of global commodity price shocks.Overall, the study highlights the critical role of regime-dependent and causal-informed policy actions in maintaining financial stability and supporting sustainable economic growth in ASEAN+3 economies. It provides quantitative insights to help policymakers and financial institutions strengthen resilience to external market volatility. https://jep.sbu.ac.ir/article_107373.html This study investigates whether governance quality enhances sustainable tax revenue by reducing the size of the informal economy, an underexplored transmission channel in emerging economies. Focusing on BRICS countries (Brazil, Russia, India, China, South Africa) over 2000–2023, we integrate the Quality of Government framework, Agency Theory, and the fiscal social contract perspective to propose a mediation model in which stronger institutions lower informality, thereby broadening the tax base. Using an unbalanced panel, we employ counterfactual causal mediation analysis via fixed-effects regressions and bootstrapping, complemented by dynamic system GMM to address sequential ignorability and endogeneity. After controlling for GDP per capita, inflation, unemployment, financial inclusion, and digital payments, governance quality exhibits a significant positive direct effect on tax revenue and a significant negative effect on informality. The indirect effect through informality is 0.317, confirming partial mediation. Furthermore, digital financial inclusion strengthens the governance–formalization link, evidence of moderated mediation. These findings extend the governance–tax literature by demonstrating that formalization is a critical mechanism, especially where informality is pervasive. Policy strategies should therefore sequence institutional reforms with formalization incentives and digital infrastructure development to maximize fiscal capacity. https://jep.sbu.ac.ir/article_107427.html This study compared major economic schools of thought using a multi-criteria decision-making approach grounded in key macroeconomic indicators. Five schools—Classical, Keynesian, Marxist, New Classical, and New Keynesian—were evaluated against seven criteria: economic growth, economic welfare, productivity, employment, equitable income distribution, human development, and balance-of-payments equilibrium. The empirical analysis relied on expert judgments collected through an Analytic Hierarchy Process (AHP) questionnaire distributed among fifteen experts, including university faculty members and Ph.D. graduates. AHP was also employed to analyze pairwise comparison matrices, establishing the relative importance of each evaluation criterion and the priorities of the five schools within the proposed framework. Results showed that the most important criteria were economic growth, human development, and productivity. Although economic growth was given the most overall weight, various schools of thought tended to prioritize different criteria; for instance, the Keynesians prioritized employment. Both New Keynesianism and Classicalism shared the priority of macroeconomic criteria. According to expert opinions and established evaluation criteria, the New Keynesian school ranked highest in overall AHP priority. The study findings underscore the value of AHP as a systematic method for comparing economic schools, indicating that growth-related criteria are generally emphasized over human-centered development criteria within this evaluation framework. https://jep.sbu.ac.ir/article_107428.html This study examines the dynamic relationship between cyberspace uncertainty and inflation in Iran using 56 quarterly observations from 2011Q1 to 2024Q4. Cyberspace uncertainty is represented by a reproducible composite SMU proxy derived from the updated Twitter Economic Uncertainty (TEU) series: the four published variants (TEU-USA, TEU-SCA, TEU-WGT, and TEU-ENG) are aligned by date, averaged arithmetically, aggregated by within-quarter means, and log-transformed for estimation. Multivariate cointegration is assessed with the Johansen–Juselius system approach, followed by a rank-two Vector Error Correction Model (VECM) and generalized impulse-response functions. A theory-guided general-to-specific restriction of the inflation equation is supported by a joint Wald test; the retained adjustment term, lagged inflation change, lagged change in cyberspace uncertainty, and lagged liquidity growth are statistically significant at the 5% level or better. The central dynamic result is horizon-dependent: an SMU innovation lowers inflation on impact and over the first few quarters, but the response crosses zero after roughly six quarters and becomes positive thereafter. This pattern is consistent with an initial wait-and-see reduction in demand followed by slower expectation, defensive-purchase, and precautionary/speculative channels. Exchange-rate innovations produce the most persistent positive inflation response over the reported eight-quarter horizon. Because SMU is a derived composite uncertainty proxy and the VECM is not structurally identified, the estimates are interpreted as dynamic conditional associations rather than definitive causal effects. The findings therefore place monetary discipline and exchange-rate stability at the center of inflation control, while information transparency and credible communication remain complementary expectation-management instruments.