Analysing agricultural products Import Pattern in Iran with the emphasis on unstability of exchange rate (Using VECM and EGARCH methods)

Document Type : Research Paper

Authors

1 Member of Science, Institute of Organize Agricultural Economics and Rural Development

2 Graduate PhD., Department of Faculty of Agricultural Economics and Development, University of Tehran

Abstract

The increasing demand of agricultural commodities as well as weak management of resources has resulted in the country in order to satisfy domestic needs, a large part of the income is spent on the import of these goods. So, in order to better managing the import of agricultural products and identifying the necessary tools to control the indiscriminate importation of these products, in this study, the pattern of imports of agricultural products (wheat, barley, corn, sugar, rice, chicken meat, meat, egg and oilseed) analyzed and evaluated, for the period 1983-2011. The results show that the price policy on imports of egg products, chicken, wheat, due to mainly impact, has the higher importance. So, import tariff on wheat, meat, and barley, as an instrument of trade policy, is very important. The study also shows that the impact of currency fluctuations in the number products is positive (meat) and in some crops (sugar) is negative. Therefore, to efficiently manage on agricultural products imports, supporting local producers and food security through food availability in the country, the appropriate policy instruments to keep pace with current trade policies, should be used.

Keywords

References

  1. Akhtar, M. A., & Spence-Hilton, R. (1984). Effects of exchange rate uncertainty on German and Us trade. Quartery Review, spring, 7-16.
  2. Asseery, A. & Peel, D. A. (1991). The effects of exchalge rate volatility on exports, Economics Letters, 37, 173-177.
  3. Aydın, F., Çıplak, U. & Yücel, M. (2004). Export Supply and Import Demand Models for the Turkish Economy, The Central Bank of the Republic of Turkey, Research Department, Working Paper No: 04/09. Ankara, Turkey.
  4. Bahmani-Oskooee, M. (1986). Devaluation and the J-curve: Some Evidence from LDCs, The Review of Economics and Statistics, 67, 500-504.
  5. Bahmani-Oskooee, M. (1996). Exchange rate uncertainty and trade flows of LDCs: evidence from Johansen's cointegration analysis. Journal of Economic Development, 21, 23-35.
  6. Bahmani-Oskooee, M., & Brooks, T. J. (1999). Bilateral J-Curve between U.S. and her Trading Partners. weltuiltschaftlictres Archiu, 135, 156- 165.
  7. Bahmani-Oskooee, M., & Gelan, A. (2006). Black Market Excharge rate and the Productivity Bias Hypothesis, Economics Letters, 97, 243-249.
  8. Bahmani-Oskooee, M., & Nasir, A. (2004). ARDL approach to test the productivity Bias Hypothesis. Review of Development Economics, 8(3), 483–488.
  9. Bahmani-Oskooee, M., & Payesteh, S. (1993). Does exchange rate volatility deter trade volume of LDCs? Journal of Economic Development, 18, 189-205.
  10. Bahmari-Oskooee, M., & Hegerty, S. (2007). Exchange Rate Volatility and Trade Flows: A Review Article. Journal of Economic Studies, forthcoming.
  11. Bailey, M. J., Tavlas, G. S. & Ulan, M. (1987). The impact of exchange rate volatility on export growth: some theoretical considerations and empirical research. Jounal of Polic, A Moddeling, 9, 225-243.
  12. Bailey, M. J., Tavlas, G. S., & Ulan, M. (1986). Exchange-rate variability and trade performance: evidence for the big seven industrial countries. Review of World Economics, 122, 466-477.
  13. Bannerjee, A., Dolado, J. J., Galbraith, J. W., & Hendry, D. F. (1993). Co-integration, error correction, and the econometric analysis of non-stationary data. Oxford: Oxford
  14. Belarger, D., Gutierrez, S., Racetter, D., & Raynauld, J. (1992). The impact of exchange rate variability on trade flows: further results on sectoral US. Imports from Canada, North American Joumal of Economics and Finance, 3, 888-892.
  15. Bini-Smaghi, L. (1991). Exchange rate variabiliry and trade: why is it so difficult to find any relationship. Applied Economics, 23, 927-936.
  16. Brada, J. C., & Méndez, J. A. (1988). Exchange rate risk, exchange rate regime and the volume of international trade. Kyklos, 41, 263-280.
  17. Burda, M. C., & Gerlach, S. (1992). Intertemporal prices and the US trade balance. The American Economic Review, 1234-1253.
  18. Chowdhury, A. R. (1993). Does Exchange Rate Volatilit5r Depress Trade Flows? Evidence from Error-Correction Models. The Reuiew of Econamjcs and Stafisfics, 75, 700-706.
  19. Cushman, D. O. (1983). The effects of real exchange rate risk on internationa-l trade. Joumal of Internatbnal Economics, 15, 45-63,
  20. Cushman, D. O. (1986). Has exchange risk depressed international trade? The impact of third-country exchange risk. Journal of international Money and Finance, 5, 361-379.
  21. Cushman, D. O. (1988). U.S. bilateral trade flows and exchange risk during the floating period, Journal of International Econamics, 24, 317-330.
  22. De Grauwe, P. (1988). Exchange rate variability and the slowdown in the growth of international trade. IMF StaffPapers, 35, 63-84.
  23. De Vita, G., & Abbott, A. (2004b). The Impact of Exchange Rate Volatility on UK Exports to EU Countries. Scottish Jountal of Politicat Economg, 51, 62-81.
  24. DellAriccia, G. (1999). Exchange rate fluctuation and trade flows: eyidence from the Europ. IMF Staff Papers, 46, 315-334.
  25. Kumar, R., & Dhawan, R. (1991). Exchange rate volatility and Pakistan's exports to the developed world, 1974–85. World development, 19, 1225-1240.
  26. Dornbusch, R. (1988). Open economy macroeconomics, 2nd ed.New York: Basic Books
  27. Doyle, E. (2001). Exchange rate volatility and Irish-UK trade, 1979-1992. Applied Economics, 33, 249-265.
  28. Enders, W. (1995). Applied Econometric Time Series. New York: John Wiley & Sons Inc.
  29. Fidan, H,. (2006). Impact of the real effective Exchange rate (Reer) on Turkish Agricultural Trade, International Journal of Social Sciences, 1: 2.
  30. Frimpong, J. M. & Oteng-Abayie, E. F., (2006). Aggregate Import Demand and Expenditure Components in Ghana: An Econometric Analysis. MPRA Paper, No. 559. Posted 27, October 2006, pp 1-19
  31. Gotur, P. (1985). Effects of exchange rate volatility on trade; some further evidence. IMF Staff Papers, 32, 475-512.
  32. Hooper, P. & Kohlhagen, S. (1978). The effect of exchange rate uncertainty on the price and volume of intemational trade. JoumaI of Intemational Economics, 8, 483-511.
  33. Kenen, P. B., & Rodrik, D. (1986). Measuring and analyzing the effects of short-term volatility in real exchange rates. The Review of Economics and Statistics, 311-315.
  34. Khan, M.S., (1974). Import and Export Demand in Developing Countries. IMF Staff Papers, 11(3), 125-147.
  35. Klein, M. W. (1990). Sectoral Effects of Exchange Rate Volatility on United States Exports', Joumcl of Internatinnal Moneg and Finatce, 9, 299-3OA.
  36. Koray, F., & Lastrapes, W. D. (1989). Real exchange rate volatility and US bilateral trade: a VAR approach. The Review of Economics and Statistics, 708-712.
  37. Kroner, K. F., & Lastrapes, W. D. (1990). The Impact of Exchange Rate Volatility on International Trade: Reduced form Estimates Using the OARCH-in-mean Model, Journal ol IntemationaL Moneg and Finance, 12, 298-318.
  38. Kumar, R., & Dhawan, R. (1991). Exchange rate volatility and Pakistan's exports to the developed world, 1974–85. World development, 19, 1225-1240.
  39. Kyriacos, A. (2001). Exchange-rate volatility, exchange-rate regime, and trade volume: evidence from the UK–US export function (1889–1999), Economics Letters, 72, 87–94.
  40. McKenzie, M. D. & Brooks, R. (1997). The Impact of Exchange Rate Volatility on German-U.S. Trade Flows. Jountal of InternationaL Financial Markets, Instttuttons and Monea, 7, 73-87.
  41. McKenzie, M. D. (1998). The Impact of Exchange Rate Volatility on Australian Trade Flows', Journal of International FinanciaL Markets, Institutinns and Money, 8, 21-38.
  42. McKenzie, M. D. (1999). The impact of exchange rate volatility on international trade flows. Journal of economic Surveys, 13, 71-106.
  43. Medhora, R. (1990). The Effect of Exchange Rate Va.riability on Trade: The Case of the West African Monetary Union's Imports. WorLd Deuelopment, 18(3), 3-324.
  44. Narayan, P.K. & Narayan, S. )2005(. Estimating income and price elasticities of imports for Fiji in a cointegration framework. Economic Modeling, (22), 438-423.
  45. Narayan, P.K. (2005). The saving and investment nexus for China: evidence from cointegration tests, Applied Economics, 37(17), 1979-1990.
  46. Nelson, D. B. (1991). Conditional Heteroskedasticity in Asset Returns: A New Approach, Econometrica (59): 347–370.
  47. Peree, E., & Steinherr, A. (1989) Excharge Rate Uncertainty and Foreign Trade. European Economic Review, 33, 1241 - 1264.
  48. Pesaran, M. H., & Pesaran, B. (1997). Microfit 4.0. Oxford University Press.
  49. Pesaran, M. H., & Shin, Y. (1997). An autoregressive distributed lag modelling approach to cointegration analysis. England: University of Cambridge.
  50. Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bound testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16, 289–326.
  51. Pozo, S. (1992). Conditional Exchange Rate Volatility and the Volume of International Trade: Evidence from the Eady 190O's. The Reuieu of Economics and Statistics, 74, 325-329.
  52. Qian, Y., & Varangis, P. (1994). Does exchange rate volatility hinder export growth? Empirical Economics, 19, 371-396.
  53. Shrestha, M. B., & Chowdhury, K. (2005). ARDL modelling approach to testing the financial liberalization hypothesis. Economics Working Paper Series 2005 (WP 05-15). Australia: University of Wollongong, June.http://www.uow.edu.au/commerce/econ/wpapers.html Accessed 20.11.06.
  54. Tang, T.Ch.)2003(. An Empirical Analysis of China's Aggregate Import Demand Function, School of Business, Monash University Malaysia.University Press.
  55. Thursby, M. C., & Thursby, J. G. (1987). tsilaterai trade flows, the Linder hypothesis and exchanger isk. The Review of Economics and Statistics, 69, 488-495.
  56. Warner, D., & Kreinin, M. (1983). Determinants of International Trade Flow. Review of Economics and Statistics, 65, 96-104.

 

Iranian Journal of Agricultural Economics and Development Research
Volume 47, Issue 4
April 2017
Pages 785-804

Files

Share

How to cite

Statistics