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Study of Economic Globalization and Growth of Agricultural Sector of Iran

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  • Nabieyan, Sedigheh
  • Suryaprakash, Satrasala
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    Abstract

    After an inward-looking strategy during the Iran-Iraq war (1980-1988), Iran has moved towards a more liberalized and open market structure. So this paper studied the effect of the process of economic globalization on agricultural sector of Iran. Sinha’s growth model was used to estimate the relationship between globalization factors and growth in agricultural sector. The stationarity of variables, Engle-Granger’s causal relationships and co-integration relationship between variables were determined. An error correction framework was applied to capture the short-run and the long-run dynamic in the growth model. Opened economy could be a cause of investing in agricultural sector, and agricultural investment could be cause of openness. No long-run equilibrium relationship observed between FDI and agricultural value addition and between FDI and agricultural investment. Openness would increase investment and growth in agricultural sector. Agricultural growth was observed to be based on labour than the investment in short-run, whereas in long-run it is mostly based on investment.

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    Bibliographic Info

    Paper provided by International Association of Agricultural Economists in its series 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil with number 126192.

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    Date of creation: 2012
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    Handle: RePEc:ags:iaae12:126192

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    Related research

    Keywords: Engle-Granger’s causal relationships; Error correction model and Globalization; International Relations/Trade; Public Economics; Research Methods/ Statistical Methods;

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