Prioritizing the Credit Allocation in Fars Province Agriculture Subsector Using Neoclassical Growth Model

Document Type : Original Article

Authors

1 Assistant Professor of Agricultural Economics, Agricultural Research, Education and Extension Organization (AREEO) (Corresponding Author) shajarish@gmail.com

2 Assistant Professor of Agricultural Economics, Shiraz University, Shiraz, Iran

3 Ph.D. Student of Economics, Shahid Beheshti University, Tehran, Iran

Abstract

The limited financial and credit resources of banks need to be allocated optimally. In addition, in order to exit from the financial freezing situation, banks and other financial institutions, such as Agriculture Bank, have to allocate resources to the economic activities and sectors in a way that it entails the highest return on capital. In this regard, the objective of this study is to analysis capital returns in Fars province agriculture subsectors using neoclassical growth model. The models include physical and human capital for each subsector. The applied data are panel data covering period of 2005-2014 throughout Fars province counties. The results showed that physical capital returns for agriculture subsectors are around 0.4 percent. It was also found that knowledge of labor or human capital does not substantially contribute to productions, indicating the traditional production method and mismatch of labor knowledge with production activity. 

Keywords

References

1. Altieri, M. A., Companioni, N., Cañizares, K., Murphy, C., Rosset, P., Bourque, M. and Nicholls, C. I. (1999). Greening of the ‘barrios’: urban agriculture for food security in Cuba. Agriculture and Human Values, 16: 131–140.
2. Arab Mazar, A. and Khademi, S. (2013). Investment priority in Iran's agricultural sub-sectors. Agriculture and Development Economics, 82: 27-43. (Persian).
3. Arab Mazar, A. and Khodarahmi, R. (1999).  Major features of the rural financial market in Iran. Quarterly Journal of Agricultural Economics and Development, 7(26): 58-43. (Persian).
4. Bagherzadeh, A. and Komeijani, A. (2012). Calculation of the marginal rate of return on investment in research and development of the agricultural sector. Agricultural Economics and Development, 26(2): 79-85. (Persian).
5. Baltagi, B. H. (2005). Econometric analysis of panel data. 3rd Edition. New York: Wiley.
6. Baltagi, B. H. (2008). Econometrics. 4th Edition. Berlin: Springer.
7. Barro, R. J. and Lee, J. W. (2000). International data on educational attainment: updates and implications. CID Working Paper No. 42.
8. Blanco, L. and Grier, R. (2012). Natural resource dependence and the accumulation of physical and human capital in Latin America. Resources Policy, 37: 281–295.
9. Central Bank of Iran (CBI). (2016).
10. Costantini, V. and Monni, S. (2008). Environment, human development and economic growth. Ecological Economics, 64:867-880. (Persian).
11. Esfandiari, A. and Tarahomi, F. (2009). Study on the employment of Iran's economic sectors with emphasis on agriculture sector. Agricultural Economics and Development, 67:93-115. (Persian).
12. Fars Province Governor Office. (2011). Document of development of employment and investment in Fars province. Document Number: EDI-PG / IN-AS / REP05IN-AS / REP05 Report. (Persian).
13. Food and Agriculture Organization (FAO). (2010). Investigating the structure, magnitude, and trends of capital formation in and for agriculture: country case study of Nepal. Rome, Italy.
14. Food and Agriculture Organization (FAO). (2014). Statistical database. Available at: http://www.fao.org.
15. Ishise, H. and Sawada, Y. (2009). Aggregate returns to social capital: etimates based on the augmented augmented-solow model. Journal of Macroeconomics, 31(3): 376-393.
16. Ghaffari, Gh. and Palouj, M. (2012). Investigating the relationship between social, human and physical capital with the value of agricultural and livestock products in the rural sector of Isfahan province. Quarterly Journal of Agricultural Economics and Development, 79: 210-187. (Persian).
17. Kupahi, M. and Bakhshi, M. (2002). Effective factors on repayment of agricultural credits Application of discriminatory analysis (Case study of Birjand city). Agriculture Sciences of Iran, 33: 19-11. (Persian).
18. Lucas, R. E. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22: 3-42.
19. Luh, Y. H., Chang, C. C. and Huang, F. M. (2008). Efficiency change and productivity growth in agriculture: A comparative analysis for selected East Asian Economies. Journal of Asian Economics, 19: 312–324.
20. Managi, S., Hibi, A. and Tsurumi, T. (2009). Doestrade openness improve environmental quality?. Journal of Environmental Economics and Management, 58: 346–363.
21. Mankiw, N. G., Romer, D. and Weil, D. N. (1992). A Contribution to the empirics of economic growth. quarterly Journal of Economics, 107(2): 407-437.
22. Mehrabi Bashrabadi, H., Eslami, M., Sherafatmand, H. and Baghestani, A. (2011). Investigating factors affecting capital productivity in Iranian agricultural sub-divisions. Agricultural Economics (Economics and Agriculture), 5:17-36. (Persian).
23. Ministry of Agriculture - Jahad (2015). Annual statistics 2014. (Persian).
24. Ministry of Agriculture - Jahad. (2016). Annual statistics 2015. (Persian).
25. Moadeli, F. (2011). Calculation of social capital returns in selected developing countries (based on the generalization of the solo generalized growth model). Master Thesis Agriculture Economics, Faculty of Economics, Management and Social Sciences, Shiraz University. (Persian).
26. Omrani, M. and Farajzadeh, Z. (2013). Role of types of capital in the growth of the agricultural division of Iran. Agricultural Economics Research, 28: 1-19. (Persian).
27. Rahmani, T., Abbasi Nejhad, H. and Amiri, M. (2007). Vestigating the effect of social capital on Iran's economic growth (Case study: provinces of the country by spatial econometric method). Economic Research, 7-2: 1-30. (Persian).
28. Romer, P. M. (2006). Advanced macroeconomics. Third edition. The McGraw-Hill. 
29. Salami, H. (2003). Determining investment priorities using the social accounting matrix. Proceedings of the Agricultural Finance Conference. Iran Agricultural Bank. Tehran. (Persian).
30. Sanromá, E. and Ramos, R. (2007). Local human capital and productivity: an analysis for the Spanish Regions. Regional Studies, 41 (3): 349–359.
31. Sherafatmand, H., Homayounifar, M., Mehrabi Bashrababadi, H. and Baghestani, A. (2009). Determining the rate of capital return in Iran's sob-sectars. Agricultural and Natural Resources Sciences, 16-3: 1-13. (Persian).
32. Soleimanipor, A. (1995). Features and estimating the agricultural credit demand function in Fars province. Master Thesis of Agriculture Economics, Faculty of Agriculture Economics, Shiraz University. (Persian).
33. Soltani, Gh. (2004). Determination of investment return rate in agricultural sector. Quarterly Journal of Agricultural Economics and Development, 12 (45): 40-19. (Persian).
34. Statistical Center of Iran. (2016). Statistical yearbook. Tehran. (Persian).
35. Taheri, F., Mousavi, S. and Farajzadeh, Z. (2012). Analyzing the effect of trade on pollutant emissions among a group of developing countries. Agricultural Economics Research, 14: 47-67. (Persian).
36. UN data, 2009. Avaliable at: http://data.un.org.
37. Yazdani, S. (1993). A critique of the performance of Iranian agricultural properties and credit policy in other developing countries. Proceedings of the Second Iranian Agricultural Economics Policy Symposium. College of Agriculture. Shiraz University. 243-231. (Persian).

Files

Share

How to cite

Statistics