Investigating the Interaction between Economic Growth and Agricultural Development in Iran

Document Type : Research Paper

Authors

• m Mohammadi Khyareh
• r Mazhari

Abstract

    Considering the importance of agriculture sector in Iran's economy and the importance of adopting appropriate developmental policies, in this research, using the ARDL approach, the short-term and long-term interactions of agricultural development and economic growth in the period of 1979- 2015 has been investigated. The results of the multivariate Granger-causality test based on ARDL-ECM estimations indicate that there is a causal relationship between economic growth and the value added of the agricultural sector in the short and long run. Furthermore, significance of error correction term implies a long-term relationship between economic growth and agricultural value added. In addition, the coefficient of error correction term shows that the effect of changes in the agricultural value added on economic growth can be seen in a very short time. As a result, the agricultural sector can be considered as an engine of economic growth in Iran, and therefore the strengthening, attention and development of the agricultural sector can lead to economic growth and development. Moreover, trade liberalization, investment and increase in employment also have a positive impact on economic growth.

Keywords

• Iran
• Agricultural Sector
• economic development
• ARDL

20.1001.1.20086407.1396.9.36.13.4

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