Exchange rate is one of the important variables that affect trade. In this paper by using GARCH method, effects of real exchange volatility on agricultural trade in Iran have been determined for period of 1973- 2007. Results of the research showed that real exchange rate volatility with one lag had negative effect on export of agricultural products in the long run. Results also showed that the effect of real exchange rate volatility on agriculture import was positive in the long run and negative in the short run. Finally, some recommendations are made to reduce exchange rate volatility.
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