Abstract
Agriculture plays a crucial role in Iranian economy in terms of food supply, job creation, food security, and foreign earnings. The main purpose of this study is to provide an estimate of the country's agricultural exports potential and to determine how efficient Iran is in realizing this capacity. Using data for 38 destination countries for the period spanning from 1982 to 2017, proper stochastic frontier gravity model was estimated. Main findings revealed direct and significant impact of trade partners' GDP and population on Iran's agricultural exports, while distance and border barriers imposed by destination countries show significant reverse effect. Furthermore, on average, 69 percent of the country's agricultural export potential has been realized through the study period. Measures to promote competitive exports along with pursuing free bilateral and regional trade agreements for removing border barriers are recommended.
Highlights
Export potential is the maximum amount of exports which is realized in free trade between nations
Agriculture plays a crucial role in Iranian economy in terms of food supply, job creation, food security, and foreign earnings
For policy purposes, it is sensible to define potential trade as the maximum trade that can occur between any two countries which have bilaterally liberalized trade regimes given the conventional determinants of trade
Summary
Export potential is the maximum amount of exports which is realized in free (no impediment or restriction) trade between nations. Such an amount can be determined for any level of export drivers (Miankhel et al in [1]). Due to heterogeneity of countries in terms of economic development, trade relationships and border policies, different factors might be responsible for inefficiency in realizing trade potential. Some exist within the exporting country (internal factors) while others relate to destination countries (external factors). Received January 18th, 2020; accepted February 21st, 2020; published May 1st, 2020. Potential exports; stochastic frontier gravity model; agriculture; Iran Key words and phrases. potential exports; stochastic frontier gravity model; agriculture; Iran
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
