Analyzing Factors Affecting on the Energy Productivity in Iran’s Agricultural Sector

Abstract
Energy is one of the major inputs in agriculture sector and considering that improving productivity is the best approach to achieve economic growth; this study investigates the effective factors of energy productivity in agriculture sector of Iran by using Generalized Average Productivity (GAP) index during 1974-2007. For calculating this index, cobb-douglas production function is estimated by Engle-Granger method and then the effects of different variables are investigated by Engle-Granger method. Results indicate that variables of labor per unit of energy, agriculture machinery capital stock per unit of energy and technology have positive effect and dummy variable during war years has negative effect on energy productivity in Iran’s agricultural sector. Moreover, variable of labor per unit of energy has the most effect (almost 70%) and the relative price of energy has no effect on the energy productivity.

JEL Classification: C22, O40, Q40, Q43
Keywords:
Energy, Generalized Average Productivity, Agriculture Sector, Engle-Granger, Johansen, Iran