Tyranny of numbers

Fact checking the meat consumption of Iranians

Posted in Inflation, Living standards, Poverty by Djavad on June 26, 2019

The rapid increase in the price of meat in the last few months has turned this food item of dubious health value into the lightening rod for the suffering of Iranian consumers.  Viewers of the BBC Persian program may recall a stark graphic that purported to show that the amount of red meat that a minimum wage worker could buy has declined from 74 kg per month in 1357 (1978) to 10 kg in 1397 (2018). (more…)

A note on measuring living standards

Posted in General, Inflation, Living standards, Macroeconomy, Poverty by Djavad on May 22, 2019

A few weeks ago, in this blog and in opinion pieces (here, here and here), I argued that during the three decades since the end of the war with Iraq (1988), Iran’s economic growth exceeded that of Turkey, such that by 2012, when US sanctions intensified, living standards in the two countries were very similar.  My analysis, which surprised some and angered others, is because of the particular data I used to measure GDP per capita (which I also refer to as the living standard).  GDP comparison is not rocket science but most journalists (and even many economists) often get it wrong.  So, in this post I try to explain why it is important that we use data specifically intended for such comparisons.

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The gold standard to measure change in household welfare in Iran

Posted in Living standards, Sanctions by Djavad on February 24, 2019

The anniversary of the Islamic Revolution 40 years ago this month coincided with the deepest economic crisis Iran has experienced since the war with Iraq in the 1980s.  As top Trump administration officials, who wished the crisis on ordinary Iranians in the hope of enlisting their help in regime change, excitement among the Iranian opposition abroad is palpable.   The occasion has also stimulated discussion of success and failure of the revolution concerning a wide range of issues and metrics.  Much of the discussion involved comparison of living standards in Iran between now and in the 1970s (read my own comparison in Project Syndicate here.) (more…)