Modeling Agricultural Growth in Iran: Focusing on Technology and Human Capital

Recent advances in the theory of endogenous technological progress have led to renewed interest in the relation between technology diffusion, human capital and economic growth. Therefore, to assess the effects of human capital and technology on growth, an econometric model is specified for the agricultural sector of Iran. This study has adopted a general version of the Cobb-Douglas production function, which in addition to the traditional inputs also includes human capital and technology. ARDL technique is employed to estimate the specified agricultural model using the data over the period 1971-2003. First, the production function is estimated and then the results are used to estimate the agricultural growth equation using error correction model framework. The results of model indicate that human capital and technology have positive and significant effects on the agricultural growth rate of Iran.