A Review on Factors Affecting the Protection of Agriculture Sector in Iran

This study aims at identifying the factors that influence protection of agricultural sector in Iran. It investigates the relation between nominal protection of producers and the independent variables including incomes from crude oil and oil product exports, capital to labor ratio in agricultural sector, comparative advantage and terms of trade during 1983-2009 with the application of Johansen methodology. The results show that the protection of agricultural sector mainly depends on the incomes from crude oil and oil product exports and the capital to labor ratio while other indexes such as comparative advantage and/or terms of trade have no significant effect in this respect. Therefore, by defining certain performance indexes for supporting policies of agriculture sector and directing the protections on the basis of these performance indexes, it would be feasible to achieve a higher return of protections as well as to spend the resources dedicated to the sector in an efficiently purposive manner.
JEL Classification: F13
Keywords:
Protection, Agriculture Sector, Aggregate Measure of Protection, Comparative Advantage, Terms of Trade