Tyranny of numbers

The reform of food subsidies under the Raisi administration

Posted in General by Djavad on May 19, 2022

There is no shortage of grievances in Iran, so explaining the recent protests that have engulfed the country is not hard. The economy has stagnated for over a decade and Inflation has been very high. But the timing of the protests suggests a connection between the protests and President Ebrahim Raisi’s program to cut food subsidies. Some media reports speak of “bread protests”, but the price of the staple bread has not changed.

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Did sanctions or Covid cost women jobs in Iran?

Posted in General by Djavad on March 16, 2022

In an IIEA panel held (virtually) on March 9, 2022, Nadereh Chamlou asked how sanctions have impacted women’s employment (about min 1:22 in the video). My answer was that identifying the impact of sanctions on women’s employment is difficult but that I thought that Covid hit women harder than sanctions. The loss of female employment has been observed around the world, where women had to quit their jobs to care for their children whose schools were closed, or had other Covid-related extra household work. Later on, Hashem Pesaran questioned my conjecture on the importance of Covid for women’s employment, which is why after the panel I looked more carefully at the labor force survey data, which confirm my statement.

The data from LFS for the past ten years show that the number of women employed reached its maximum during 2018-2019 at 4.3 million, when sanctions were toughest. This number fell to 3.7 million in 2020, most likely because of Covid since sanctions did not intensify in 2020. Furthermore, this decline was not matched by decline in men’s employment as the ratio of female to male employment also fell in 2020 for all age groups (see Table below). For prime age workers (25-54 years old), this ratio fell from 24.4% in 2019 to 21.3% in 2020. Roughly twice as many women lost their jobs in 2020 compared to men (665,000 vs. 357,000).

Year15-2425-5455-6565-7575+
20100.2160.2290.2250.1360.062
20110.1840.2110.1990.1280.051
20120.1820.2200.1960.1450.050
20130.1780.1940.1670.1190.045
20140.1620.1930.1630.1190.058
20150.1770.2140.1850.1370.057
20160.1960.2330.2010.1530.058
20170.2160.2450.2170.1630.066
20180.2270.2450.2120.1840.057
20190.2260.2440.2110.1950.071
20200.1810.2130.1820.1740.068
The ratio of female to male workers by age group. Source LFS.

Is Iran’s inflation heading back up?

Posted in General by Djavad on January 21, 2022

The latest data from the Statistical Center of Iran (SCI) for inflation show that prices rose faster last month (the Iranian month of Dey ending on January 20) compared to the month before. At that time, inflation was on its way down from its peak of 59% annual rate in September to 22% in November. Last month it was back up to 32% last month. This is potentially bad news for the Raisi government, which is keen to show that his government can control inflation and dispel endless rumors that Iran’s economy is on the brink.

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Iran’s propsed budget for 2022/23 (1401)

Posted in Budget, Sanctions by Djavad on January 16, 2022

This year’s proposed budget takes more significance than budgets in pervious years because it is the first by the new “principlist” (the Persian adjectives are osoulgara or enghelabi) government of President Ebrahim Raisi. It is also significant because the government is engaged in the JCPOA talks in Vienna. It is natural to read it both for signs of policies to expect from a government that has promised a radical shift in foreign and economic policy, and as it relates to the government’s negotiating position in Vienna.

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Rising poverty and falling living standards in Iran in 2020

Posted in General, Inequality, Living standards, Poverty by Djavad on August 28, 2021

The Statistical Center of Iran (SCI) has released the micro data from its most recent annual Household Expenditure and Income Survey (HEIS) for the Iranian year 1399 (21 March 2020 to 20 March 2021). The results do not surprise — the downward slide in living standards and the rise in poverty that started a decade ago continues. Along with the more positive news on the GDP and employment front that have become available in the last few weeks, the survey offers a relatively accurate if mixed picture of a country and a people struggling under the Trump-Biden maximum pressure campaign. Relative to household welfare, the economy is doing better. GDP grew by 3.6% last year and last quarter (spring 2021) 200,000 more people were working compared to a year ago. This makes perfect sense since falling real wages that are hurting welfare are good for employment and production.

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The role of external shocks in Iran’s inflation

Posted in General by Djavad on June 17, 2021

Last month, the consumer price index (CPI) rose at annual rate of 9.4%, down from 37.4% the months before and far lower than its peak increase of 85% last October. By itself, this is no indication that inflation is slowing. Based on past experience, inflation is likely to go back up, but it may well be a sign that inflation is on its way down, the same way it happened after the previous two bouts of high inflation in the past decade. Inflation is the most important grievance of Iranian voters as they go to the polls this week, so it is worth taking the monthly drop seriously.

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Five figures show the losers and winners of economic growth under different presidents of the Islamic Republic

Posted in General by Djavad on May 2, 2021

Iran has been under four different presidents since the end of the war with Iraq in 1988, each with its own style and philosophy. As the June presidential election nears, it is interesting to look back to the past and ask how each administration did in terms of inequality, and how the poor, the middle class and the rich fared under them.

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Iran’s Covid-19 fatalities: excess deaths show serious undercounting

Posted in COVID-19 by Djavad on November 10, 2020

The question of accuracy of reported Covid-19 deaths is not news for most countries, but in the case of Iran it is because it has geopolitical significance. Iran’s foes are interested in it because the higher the number of deaths from Covid in Iran, the more likely Iranian leaders are to stop resisting US economic pressure. For others, who care more about the plight of ordinary Iranians, higher true fatalities signify a greater humanitarian cost of US sanctions. (more…)

Update on Iran’s Covid-19 epidemic

Posted in COVID-19 by Djavad on May 17, 2020

In a recent webinar at Harvard’s Middle East Initiative and a virtual conversation with Princeton’s Iran Center (here) I discussed the extent of the Covid-19 epidemic in Iran, and each time noted that, given the country’s high level of economic distress and the government’s tight budget, stay-at-home rules may not last very long.  This has come to pass now. A few weeks ago the government relaxed the social distancing guidelines and, after a month of decline in the daily numbers of cases and deaths, both rates seem to be heading back up. (more…)

Making sense of Iran’s coronavirus statistics

Posted in COVID-19 by Djavad on April 17, 2020

Iran’s COVID-19 crisis has gotten lots of media attention because Iran was an early epicenter of the pandemic, and because of its geopolitical significance.  The crisis has also intensified pressure on the Trump administration not to heed calls by former world leaders, former US diplomats, and influential newspaper editorials, to ease sanctions against Iran.  For some proponents of regime change in Iran the epidemic is more than a human tragedy: it is also the proverbial straw that could break the camel’s back, which is why throwing some light on the intensity of the crisis is timely. (more…)