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This article seeks to modeling social welfare functions, for assessment of how distribution of transfer payment among socio-economic levels. We consider providing social welfare functions two scenarios, first the each socio-economic levels receives amount of transfer payment equal to others, and second the each socio-economic levels receives that with weighted preferences. The four basic functions determine optimal value of how distribution, and then calculate actual value of that by transforming COICOP to ISIC . Finally the difference between optimal and actual values is determined for rural and urban society and for first and second scenario. At the first scenario the difference between optimal and actual value is smaller than second and this difference at rural society is greater than urban society. The other hand the welfare distribution at the former is worse than later.

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The effect of equivalence scale on poverty line has been considered as a predetermined parameter in all previous studies about the estimation of poverty lines in Iran. As household’s members can benefit from economies of scale in consumption, the cost of reaching to a given level of welfare does not increase one to one in household scale. So the effect of household scale on poverty line as a predetermined parameter creates bias. The main purpose of this study is to estimate the poverty line regarding the household scale. The utility function and the indirect household expenditures under consumption behavior approach are estimated based on income-expenditure data for 204464 Iranian urban households during2001-2007. Then poverty lines (in nominal and real units) per household scale (1to 10 members) are calculated based on indirect household expenditures.

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Money is a facilitator of economic activities, thus, formatting of economic activity is dependent on the institutionalizing of monetary system. In common monetary system, the weakness of common perception about money, publishing and distributing mechanism led to inefficiencies in optimal allocation of resources and welfare cost of inflation tax. Partial equilibrium model in compare with general equilibrium model, underestimate welfare cost of inflation tax. Therefore, in dynamic optimization model, the equation of welfare cost of inflation tax, in addition to general equilibrium model of Lucas, derived from theoretical correction of demands for real money balances. Then welfare cost compared theoretically and experimentally in partial and general equilibrium model. Theoretical and experimental results indicate that the welfare costs of inflation tax in general equilibrium models, is an upper bound of partial equilibrium models. Also, given that the elasticity of demand for money in regard to the nominal interest rate, the welfare cost of inflation tax increases with nominal interest rate and inflation.