Analyzing the impact of export premium on agricultural export development

Document Type : Research Paper

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Abstract

The augmented gravity model was used to analyze the impact of export premium on Iranian agricultural exports by applying the panel data of 1992-2005 for 72 countries which are considered as the main market of Iran's exports. The results showed that all the gravity factors (population, GDP and distance) have significant effects on agricultural export in both developed and developing countries. In addition, the results confirmed the positive and significant effect of export premium on increasing agricultural export and revealed the effect of this premium through gravity factors. Since the impacts of effective factors on export are not probably momentary, the dynamic gravity model was regressed to separate the short and long run elasticities. The premium has a positive effect on agricultural production export both in short and long run. But, it is higher in long run. So, the study tries to make persuasive programs which follow long run goals.

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