Investigation of the interactive impacts of exchange and inflation rates on the export of agricultural productsand food stuff in Mazandaran province.

Articles in Press

Document Type : Research Paper

Authors

1 Babol Mazandaran iran

2 Agricultural Economics, Faculty of Agricultural Engineering, Sari Agricultural Sciences and Natural Resources University, Sari, Iran.

3 Ph.D Student of Agricultural Economics, Faculty of Agricultural Engineering, Sari Agricultural Sciences and Natural Resources University, Sari, Iran.

10.22059/ijaedr.2025.388231.669346

Abstract

The relationship between inflation and the exchange rate has always been one of the most intriguing topics for economists. This relationship is particularly crucial in volatile economies such as Iran. In such economies, fluctuations in the exchange rate can significantly impact the general price level. The objective of this study is to examine the effects of inflation on the relationship between the exchange rate and the exports of agricultural and food products from Mazandaran province. The study period spans from March 2018 to March 2023, covering data from 9 major export destination countries. A panel data model was employed, and after conducting the Hausman test, the fixed-effects method was selected for estimation. The results of the study reveal that the relative position of the exchange rate, compared to the monthly inflation rate, not only affects the level of exports but also influences the slope of the exchange rate. On average, when the monthly exchange rate growth exceeds the monthly inflation rate, exports are approximately $250,000 higher compared to the opposite scenario. Additionally, in this case, the effect of the exchange rate on exports is nearly 3 units lower than in the opposite scenario, indicating greater export elasticity to the exchange rate in this situation. Based on these findings, it is recommended that the exchange rate be liberalized to align it with the inflation rate, and support for vulnerable groups should be implemented through methods other than exchange rate stabilization. Furthermore, it is suggested that similar studies explore the possibility of changes in export behavior in response to inflation and its relative growth.

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Iranian Journal of Agricultural Economics and Development Research

Articles in Press, Accepted Manuscript
Available Online from 04 October 2025

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