The effect of the dynamics of women's education on macroeconomic variables with the approach of DSGE models

Document Type : Research Paper

Authors

1 Assistant Professor, Department of Economics, Payam Noor University, Tehran, Iran.

2 Assistant Professor, Department of Economics, Meybod University, Meybod, Iran.

Abstract

The human resources utilization method is so important in the development of the economic and social indicators of any country; For the reason that human resources are the most important factor in achieving economic development; So that, it is impossible to achieve economic growth and development without expert and efficient human resources. Many factors are effective in the empowerment of human resources, among which education is one of the most important. Gender differences and gaps in education can be introduced as one of the basic obstacles to economic growth and development, and it may prevent women from participating in society. The majority of social experts believe that Iranian society has undergone many social, cultural, political, and educational changes in the last few decades, especially after the Islamic revolution. One of the most important developments, like many developing countries, has been the expansion of education at various levels. This event has been associated with the significant participation of women and girls in education. In order to investigate the impact of these changes in this research, has been investigated, the impact of the positive momentum of women's education and technology on macroeconomic variables such as production, investment, and employment in Iran. The Dynamic Stochastic General Equilibrium (DSGE) model has been used to achieve the research goals. In this model, the economy is divided into three sectors: households, firms, and the government. Households include people (women and men) who gain utility from consuming goods and services and keeping money and lose utility from working and have the goal of maximizing their utility according to the constraints of the household budget. Firms are producers of intermediate and final goods. A continuum of monopolistically competitive firms produces intermediate domestic goods using labor and capital. There is perfect competition in the production of final goods, with the output of intermediate firms as inputs and according to a production function with constant returns to scale. The imperfect competition in the goods market is introduced by assuming that each firm produces a differentiated good for which it sets the price. Some constraints are imposed on the price adjustment mechanism by assuming that only a fraction of firms can reset their prices in any given period. In particular, a model of staggered price setting due to Calvo (1983) and characterized by random price durations is adopted. Finally, the central bank and the government implement monetary and financial policies. The obtained results from impulse response functions show positive impulse of women’s education increases production and investment, as well as employment. According to the results of the research, it is recommended to pay more attention to appropriate investments in the field of women's education by using appropriate policies in order to obtain as many benefits as possible for scientific development and higher economic growth. In such a way that practical training in jobs related to women increases female labor force participation and creates new job opportunities.

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References

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Woman in Development & Politics
Volume 21, Issue 3
September 2023
Pages 637-660

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