Examining the Factors Affecting Iranian Government Support of Agricultural Products Market

Abstract

As one of the oldest sectors of economy, agricultur e has had an important role in the supply of food for people and raw materials . In this study, the factors affecting the Iranian government support of agricultural products market has been investigated for the period of 1989-2011. In this regard, using the theo ry of efficient redistribution and panel data of 12 selected agricultural products including wheat, barley, rice, cotton, pistachio, apples, dates, beets, eggs, milk, red and poultry m eat, the rationale for government intervention in the agricultural sector has been mo deled in the Panel Tobit model framework and is then estimated . The results of this study indicated that the elast icity of supply and demand, the share of total exports of ag ricultural goods, the real income of farmers, number of farmers, the share of total agri cultural output, and concentration of production are the factors that are directly relate d to the amount of agriculture support, such that, with the increase in each of these varia bles, the amount of government support has increased. However, the results showed no signi ficant relation between the import variables (the products which have similar domestic production) and also the number of agricultural cooperatives and organizations with th e level of government support. Keywords: Agricultural support policies, Efficient redistrib ution, Panel Tobit model.