Understanding of the relationship between macroeconomic variables and its impact on the economy is important in planning and policy. According to Basic role of agriculture in national development, this study attempts to examine the impact of short-run and long-run relationship between the agricultural revenue and macroeconomic variables Such as real exchange rate, interest rate, liquidity, price index of agricultural products and petroleum revenue during the period 1991-2008. Therefore, autoregressive distributed lag (ARDL) approach used. Hence, Long-run relationship is identified between macroeconomic variables and the agricultural revenue. Price variable of agricultural products has a positive effect in long-run and a negative effect in short-run. Interest rate has negative relationship in short-run and long-run with the agricultural revenue. Real exchange rate has a positive relationship in long-run with the agricultural revenue, while it is not significant in the short-run. Also results indicate that liquidity has positive relationship in long-run with the agricultural revenue. Increasing liquidity has a positive relationship in the current period and a negative relationship in the next period in short-run. Considering the results, effect of petroleum revenues in short-run and long-run is Low and negative. Imbalance of short-run adjusted to long-run after about two years.

JEL Classification: C22, Q11, E23

Keywords:
Interest Rate, Exchange Rate, Liquidity, Petroleum Revenue, Agriculture Sector Revenue