Response of Iran's Agricultural Export to Credit with Special Emphasis on Sub-Sectors

The purpose of this study is to investigate the effect of credit on agricultural export. Therefore, first the effect of credit on value added, and then the effect of value added on exports has been studied. In this direction, panel data of agricultural sub-sectors was used during the period of 1991 to 2011, and the related functions were estimated by using 2SLS method. Results show the positive effect of credit, capital stock and labor on value added. The effect of real exchange rate, relative price, value added and importing countries income on exports was also shown to be positive. Results also show the positive effect of credit on exports. As credit was shown to be an effective factor of agricultural exports, it has to be considered by policy maker. Although these government protections are deceivable, they should have rational trend, not to keep agricultural sector as premature industry.