The main purpose of this study is to examine the impacts of economic factors and financial corruption on
economic discomfort in Iran from 1975 to 2010. Economic discomfort, defined as the sum of the unemployment
rate plus the annual rate of inflation. Unrestricted Error Correction Model (UECM) is employed to do bounds
test and to examine the presence of cointegration. The results indicate that, in the short run, economic
discomfort decrease as financial corruption, trade openness and interest rate increase. Even so, it increases as
income inequality increase. Besides, in the long run, except for interest rate, financial corruption and income
inequality are positively associated with economic discomfort .Indeed, interest rate having adverse impact on
economic discomfort. The effects of other variables are not confirmed.
کلید واژگان :
Economic Discomfort Index, Financial Corruption, Trade Openness, Income Inequality, Unrestricted Error Correction Model
