Iran’s credit line to Syria: A well that never runs dry (2020)

Atlantic Council, with Ali Fathollah-Nejad (Op-ed)

The credit line does not help to assess Iran’s involvement in Syria—it is instead a cover for the total cost of Iran’s engagement there. Putting the value of Tehran’s intervention in Syria in perspective reveals the high cost of its adventure in the country and highlights the increasing difficulty of continuing it as Iran continues to hemorrhage due to punitive US sanctions, specifically on oil. As what Tehran has spent in Syria far exceeds what is announced, another question is how much Syria owes Iran. Should Syrians pay back what is in the books or what is actually spent? Only time will tell.

Trump's Crude Justification (2019)

Carnegie Middle East Center, with Armenak Tokmajyan


On October 6, President Donald Trump announced the withdrawal of U.S. forces from Syria as he declared victory over the Islamic State. Yet under bipartisan pressure in the United States, Trump soon backpedalled on the U.S. pullout. This was the second time in less than a year that he had done so. This time, Trump’s justification was that U.S. forces would stay to "take Syria’s oil". This article argues that taking Syria's oil is simply an excuse for the president’s decision to backtrack on the withdrawal as it is hardly economically feasible.

The Syrian Oil Crisis: Causes, Possible Responses, and Implications (2019)

Middle East Institute (policy paper)

Unlike most other goods, the inflation-adjusted prices of oil and oil derivatives actually became cheaper in the years after the Syrian uprising and the loss of most of the country’s oil fields. Iran stepped in to fill the gap by shipping oil by sea through the Suez Canal. In recent months, however, these shipments seem to have ground to a halt, crippling regime-controlled areas. This paper examines several competing explanations for the slowdown in Iranian oil shipments, explores a range of possible responses for the Assad regime, and takes a closer look at the implications for the regime, its allies, and regular Syrians.

Reconciling International Trade Data (2019)

Working Paper

International trade data are filled with discrepancies–where two countries report different values of trade with each other. I develop a novel trade data quality index for reconciling the discrepancies in bilateral trade data. I calculate the quality for each country’s imports and exports separately for every year from 1962 to 2016 and reconcile international trade data by picking the value reported by the country with higher data quality in every bilateral flow. The reconciled data reshape our views on international trade: (a) countries with low data quality under-report their imports and exports: low-quality reporters are 14% more open to trade using reconciled data; (b) corruption, the level of development, and erroneous reporting can explain data quality; (c) importers’ data are more accurate; (d) China tends to under-report its exports and over-report its imports, while there is only a small difference between US self-reported and reconciled data.

Mortgagor Vulnerability and Deposit Affordability in New Zealand before and after the Loan-to-Value Restrictions (2018)

Reserve Bank of New Zealand (policy paper)

Mortgagors constitute a third of households in New Zealand, and the vulnerability of mortgagors to different risks impacts the financial system as a whole. This study uses Household Economic Survey (HES) microdata provided by Statistics New Zealand to assess changes in the vulnerability of new non-investor mortgagors from 2006 to 2016. The data also enables me to estimate ‘deposit affordability’ – the affordability of the equity required from households to purchase houses. My measure of affordability computes the number of years required to save a deposit given the Loan-to-Value rules that apply in the country as a whole or in a given locality.

Housing Leverage and Consumption Expenditure-Evidence from New Zealand Microdata (2018)

Reserve Bank of New Zealand, with Fang Yao

(academic paper)

This paper investigates how household debt affects the marginal propensity to consume out of housing wealth. We use New Zealand household-level data on spending, income, and debt over the period 2006-2016. The main empirical challenge is to identify exogenous variation in house prices to determine how consumption evolves with movements in household wealth. This identification problem is complicated by the presence of unobserved household characteristics that are correlated with housing wealth. We use a detailed house sale dataset to derive local average house prices and use it as an instrument. Our empirical results show that the estimated elasticity of consumption spending to housing wealth is about 0.22%. In dollar terms, the average marginal propensity to consume out of a one-dollar increase in housing wealth is around 2.2 cents. Furthermore, our empirical results also confirm that household indebtedness, especially via mortgage debt, acts as a drag on consumption spending, not only through the debt overhang channel, but also through influencing the collateral channel of the housing wealth effect. 

Why you should use high frequency data to test the impact of exchange rate on trade (2017)

Applied Economics Letters, with Mohammed Khaled

(peer-reviewed academic paper)

This study suggests that testing the impact of exchange rate on trade should be done using high-frequency data. Using different data frequencies for identical periods and specifications between the US and Canada, we show that low-frequency data might suppress and distort the evidence of the impact of exchange rate on trade in the short run and the long run.

Impact of the civil war on Aleppo’s job market (2016)

Aleppo Project, School of Public Policy, Central European University (policy Paper)

Studies of the Syrian civil war have largely focused on topics such as refugees and casualties and have left the crucial topic of employment greatly under-researched. Understanding changes in the composition of the job market will greatly enhance reconstruction efforts in post-war Aleppo as it allows a better understanding of the availability and quality of the labour force.

In late 2014 and early 2015, The Aleppo Project surveyed 1001 Aleppians about many issues. 

This paper focuses on the two questionnaire items related to current professions of the respondents and their previous professions. The major findings of this paper include:

  • The composition of the job market has pointedly changed due to the conflict

  • Unemployment more than doubled due to the conflict. This applies to Aleppians within the city and abroad

  • Differences in the rate of unemployment among Aleppians are largely explained by gender, age, education, and the neighbourhood from which the respondents come.

I believe that policymakers in post-war Aleppo will be faced with very high unemployment rates as the returnees with the fewest economic opportunities abroad come to Aleppo first to seek jobs. Ignoring the unemployed might ignite new unrest and could make the process of reintegration and reconciliation harder. 

Policymakers should develop special initiatives to deal with the special situation of employment that will emerge as soon as the war ends. These initiatives should include labour-intensive reconstruction projects in order to absorb the expected excesses in unskilled labour supply.

Re-examination of price level differentials using economic freedom index (2016)

Journal of International Trade & Economic Development, with Mohamed Ariff (peer-reviewed academic paper)

Findings reported in this paper provide an improved explanation as to what factors are correlated with price levels across a large sample of 152 countries. The results are obtained from using a new set of variables called economic freedom indices, covering 19 years. Prior studies used income, trade openness, and productivity, which led to results with much less explanatory power compared to findings reported in this paper. We apply advanced panel data econometrics to obtain robust estimates of parameters, which, in our view, led to results with a substantially high coefficient of variations close to 90%. The findings show that all the nine dimensions of economic freedom used in this study significantly account for the variations in national price levels.