Effectiveness of Support Policies on the Production of Rice in Iran

Authors

• S. H. Sadatbarikani
• A. Azari

Abstract

Considering the importance of agricultural sector in food production and safety, countries, including Iran, support this sector in different ways .Looking at the trend of production, consumption and imports in Iran, show that the despite of production to be growing, Iran still stands as one of the largest importers of agricultural products in the world. The basic discussable question is “how the great costs of applying supports by government policies could be effective on crop production and yield?” Accordingly, in this study, AMS for rice is calculated during 1989-2009 and existence of causality relationship between amount of support and production growth of the products was investigated by using Hsiao's granger causality method. The results indicate that have not had an effect on the production and yield, althouqh the causality relationship between supports enhance and acreage growth was observed. Therefore, a review into the support policies and transmission of subsidies from early stages production to other levels such as marketing, distributing and etc, is suggested. To achieve more efficiency, support policies should aim to increase the yield applaying. A higher guaranteed purchase price, for high yielding varieties rather than the market price for traditional varieties and a set of support policies aimed at improving the production technology are suggested.
 

Keywords

• Support policies
• AMS
• causality relationship
• Hsiao's method
• error correction model

20.1001.1.20086407.1391.4.15.9.3

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