mahmood hooshmand

Considering the high potentials of Mashhad in health tourism development, the aim of this study is to identify the strengths, weaknesses, opportunities and threats of health tourism in Mashhad. For this purpose, first, the key strengths, weaknesses, opportunities and threats of this industry were extracted through in-depth interviews with the experts and authorities of the active units in the field of health tourism in hospitals and health tourism companies in Mashhad. Then, using the questionnaire and SWOT method, the experts' opinions on extracted strengths, weaknesses, opportunities and threats were analyzed. Finally, health tourism supply chain of Mashhad extracted and appropriate strategies were adopted. The results show that among the internal factors, low costs is the biggest strength and weakness in advertising is the biggest weakness. Among the external factors, Imam Reza Shrine is the greatest opportunity, and the presence of great competitors and major challenges with Arab and Western countries are the greatest threats. Due to is being more weaknesses than strengths and the being more opportunities than threats, health tourism development in the city of Mashhad should be pursued through a revision strategy.Mashhad is the second largest religious metropolis in the world with about 30 million tourists annually. Most tourists travel to Mashhad for the purpose of pilgrimage, along with sightseeing and medical services. The spirit of pilgrimage tourism is in fact the healing of the holy site of Imam Reza (AS).Mashhad has great potential in both health tourism sectors, namely tourism and health. In the tourism sector, the existence of hotels, markets, visiting centers, play areas, water complexes and transport infrastructures, etc. can be as structured system to attract the health tourist. In the treatment sector, the presence of experienced physicians, skilled medical staff, equipped medical centers and the most sophisticated surgery in accordance with the science of the day can be the most important capacities in this field. However, there are barriers and challenges to the development of health tourism in Mashhad which have prevented it from achieving its rightful place in employment creation, value added and currency production. Therefore, scientific analysis of the challenges and opportunities of this industry and adopting realistic strategies tailored to the strengths, weaknesses, opportunities and threats is an essential step in the development of health tourism in Mashhad. Although empirical studies have so far examined the issue of health tourism from various aspects, this article has analyzed the health tourism industry with a different approach and from a supply chain perspective.For this purpose, first, the key strengths, weaknesses, opportunities and threats of this industry extracted through in-depth interviews with industry experts including managers and authorities of international patients' admissions to private and public hospitals and managers of health tourism active companies in the city of in Mashhad. Then, by using the questionnaire and SWOT method, the experts' opinions on extracted strengths, weaknesses, opportunities and threats were analyzed and health tourism supply chain of Mashhad extracted. Finally, necessary strategies suggested.Therefore, health can be considered as a factor in people's decision-making abroad, for various reasons. One may travel for special surgeries, while the other may travel only for rest and relaxation (Hui and Wan, 2009: 110).Wong et al )2014) state that health tourists' motivation to receive health care outside their area of residence is influenced by many factors including cost, time, rules and regulations, medical preferences and service availability, quality, Leisure tourism and information availability (Wong et al, 2014: 1).It is predicted that health growth, the so-called health or prevention boom, will be the new "economic power". This is due to lower constraints, higher innovation potential and the focus on customers and their demands and needs (Hofer et al, 2012: 60). On the other hand, health tourism can be a solution while health poverty is one of the biggest problems in developing countries (Bookman and Bookman, 2007: 7).The health tourism industry is the most important subdivision of the tourism industry that has higher economic and social benefits (such as increased employment, exchange and income generation) than other sub-sectors. Mashhad also has unique features and opportunities compared to other cities in the field of health tourism, but due to challenges in this industry has not yet reached its main position. The purpose of this study is to identify the strengths, weaknesses, opportunities and threats of the health tourism industry in Mashhad and to present strategies to develop and improve this industry. To achieve this goal, information was extracted by in-depth interviews with industry experts, then extracted information was analyzed by questionnaire and SWOT method and health tourism supply chain of Mashhad extracted. The results of the analysis show the biggest strengths is the low costs of tourism services and the biggest weakness is weaknesses in advertising and marketing in the health tourism industry in Mashhad. The greatest opportunity is the presence of Imam Reza (AS) shrine and the biggest threats are the presence of great competitors and major challenges with the Arab Western countries. According to the results of this study, considering the weaknesses of this industry is more than its strengths and opportunities more than threats, the development of the health tourism industry in Mashhad should be pursued through a revision strategy. Therefore, the following strategies are suggested:

Economic growth in a country is always one of the important goals and achieving this goal requires growth in all areas related to that economy. Achieving this goal is possible when the competitiveness of the regions increases and its economic performance improves and economic growth in all economic regions tends to a steady trend and becomes so-called convergent. One of the factors that have been considered in recent years as a factor explaining economic growth is the proximity and spatial position of regions. Therefore, the purpose of this article is to investigate the effects of spatial urban spillover on economic growth of the provinces and also the role of urbanization on the rate of convergence of provinces.

One of the important issues in urban economics is how the relationship between urban population growth and economic growth. In this regard, Lefebvre (2009) considered the economic structure and economic growth. According to Bertinley and Black (2004), the channels through which urbanization affects economic growth: First, cities play an important role in the economies and societies of developed and developing countries by providing opportunities for people to benefit from educational, employment and health services in the economic structure of the city.
Second, urbanization allows businesses to take advantage of economies of scale due to externalities, and this makes it possible for companies to specialize and reduce transaction costs. Third, urbanization is a major factor in entrepreneurship. The concentration of population and businesses in cities makes the urban population easily finance their idea and provide the conditions for promoting business ideas and access to local markets with higher consumer density, and ultimately there are spillover effects, these positive external effects of development. Cities in neighboring areas are identified through migration and active interaction. Therefore, according to these theories, there is no separate region and the growth of each region is affected by the growth of the surrounding regions. Thus, despite the effects of urban spillovers, the economic growth of the provinces is converging. In the economic literature, the main idea of ​​convergence is that the lower per capita economy experiences a higher growth rate than the higher per capita economy.

Econometric researchers believe that due to the impact of economic performance of an area on neighboring areas, if the spatial dependence between observations and these effects are not taken into account, the conventional estimation method will be biased and the effect of factors trying to study them will be erroneous. Since the variables used in this study have a spatial aspect and are affected by spatial correlation, and considering that the main purpose of this study is to analyze the role of urbanization in the spatial convergence rate of the provinces, the spatial econometric model is used. Consider each other's observations and the effect of changes in dependent and explanatory variables on neighboring observations. Spatial growth models explicitly include spatial factors in growth models. These models pay more attention to spillovers and seek to find the main drivers of long-term growth in space.

Before estimation of spatial models, to emphasize the need to use spatial patterns in this study, diagnostic tests were performed to estimate the pattern as panel data. As stated in the methodology section, the research model is estimated in three stages. In the first stage, the absolute convergence model is estimated in which there is no urbanization variable. In the second stage, to evaluate the effect of urbanization on convergence and its speed, conditional beta convergence is estimated in terms of urbanization effects, and in the third stage, the space camera model is estimated in terms of urban spatial effects. In absolute beta convergence, it is assumed that the model parameters are the same and the only cause of changes in the economic growth of the provinces are their initial values. Another important point that should be considered before estimation is the spatial effects test that was analyzed in the above sections and therefore the estimation patterns should be estimated in terms of these spatial effects. The results of the first stage estimate show that the sign of convergence coefficient is negative and significant and indicates the existence of absolute beta convergence, i.e., provinces with lower per capita production have faster economic growth than provinces with higher per capita production. Convergence rate is estimated to be 0.0563, This coefficient indicates that about 5.63% of the gap between the initial state of per capita production and the state of equilibrium with its stability is eliminated annually. With the introduction of the urbanization variable into the model, the use of absolute beta convergence is no longer correct because economic growth is also affected by other factors such as urbanization, so in this case conditional beta convergence is raised. In the second stage, the results show that the inclusion of the urbanization variable in the convergence equation leads to a decrease in the estimated coefficient for the initial per capita production variable. In other words, the convergence rate has increased by 1.45% compared to the previous case. The positive effect of urbanization on the convergence of provinces.
Finally, the general convergence hypothesis that other parameters are not constant is investigated and the conditional beta convergence is estimated using the space camera model in terms of other effective variables. The results indicate that in this case, each province has an average rate of 14.29% are moving towards sustainable growth. Therefore, it can be claimed that in terms of direct effects and spatial effects (spillover) of urbanization, the rate of convergence increases.

The purpose of this study is to investigate the economic convergence among the provinces of Iran during the years 2005 to 2017. For this purpose, two types of convergence, absolute beta and conditional beta, were investigated by using spatial growth models. Therefore, first, by performing Moran I test and LM test, the necessity of using spatial models was confirmed. In the present study, in order to better explain the role of urbanization in the rate of convergence of the provinces, the research model was examined in three stages. The results of all models show that the provinces of the country are economically convergent and the existence of absolute and conditional beta convergence between the provinces is confirmed, i.e., less developed provinces have a higher economic growth rate and provinces that are stable from equilibrium. They are more distant; they have a higher economic growth rate. Considering the significance and positive effects of urban spatial spillover, it can be concluded that increasing the interaction and return of citizens to neighboring areas in the provinces due to the effects of the spillover will cause economic growth in neighboring provinces and this will increase the speed of economic convergence.

Extended Abstract
1- Insurance is one of the useful tools of risk management to ensure the peace and comfort of people in the community. Considering the role of life insurance in helping people save and invest and its effective role in economic growth, we can understand the importance of this field of insurance in the economy of countries (impact on household economy in developed or developing countries). the purpose of this study is to investigate the relationship between growth of life insurance and economic growth in selected countries in the MENA region. Since there was no access to uniform statistics for all countries in the MENA region, the study was used on 13 selected countries in the region using balanced data for the period 1994-2017. In this study, in order to investigate the causal relationship between the growth of insurance industry activities and economic growth, the Demteresco and Herlein (DH) causality model has been used for the data panel.
2- THEORETICAL FRAMEWORK
Considering the important role of the insurance industry, especially life insurance in the economies of countries, the study of the impact and also the impact of life insurance on economic growth in previous research were studied, which are divided into two categories.
2-1- The Impact of Life Insurance on Economic Growth
Four factors (population, natural resources, investment and technology) play an important role in the process of economic growth, the most important of which is capital or financial resources. for this reason, access to financial resources is very important to increase economic growth. one of the most important prerequisites for economic growth in all countries is financial resources for productive investments. access to financial resources can be provided through various means such as foreign borrowing, sale of bonds, etc. but the best way to provide it is to use people's savings. insurance is one of the important channels of savings and important financial institutions, which in addition to providing security for economic activity, also plays a key role in providing investable funds.
The insurance industry leads to the development of investments in economic systems in two ways. on the one hand, by guaranteeing the coverage it provides, it reduces the effects of investment threatening factors that result in the expansion of investments, and on the other hand, insurance companies participate in various economic and commercial activities as investors from the resources at their disposal. this way in paving the paths that lead to the development of the country play an important role. the greater the share of insurance in the economies of countries (insurance penetration rate), the greater the impact on economic growth.
2-2- The impact of economic growth on life insurance
Studies have shown that there is a two-way relationship between economic growth and the growth of the insurance industry. in most studies, the per capita income index is considered as a proxy for economic growth. one of the factors that has a strong impact on increasing the demand for life insurance is the income of individuals. demand for life insurance increases as economic growth increases and, consequently, per capita income increases and, as a result, purchasing power increases. inflation also affects the demand for life insurance in two ways. first, inflation causes life insurance capital to be paid at a much lower real value than at the commencement date of the contract. in the context of inflation, if the insurance companies do not neutralize the negative impact of inflation on the real purchasing power of the insured capital by applying some appropriate methods, the purchase of life insurance policies will decrease day by day. as a result, it diverts people from the demand for life insurance and leads to safer or shorter-term investments. unemployment will have a negative impact on the demand for life insurance and, consequently, the growth of the insurance industry. according to research, one of the main motivations for buying life insurance is to protect family members against the early death of the breadwinner, and the amount of life insurance sales depends on the number of dependents on the breadwinner, which is called the dependency ratio (Campbell, 1980). With increasing population and increasing dependence on the breadwinner of the family, the risk of financial crisis of the family in the event of the breadwinner's death is felt more, so the need for insurance coverage in this area becomes more apparent.
 
3- The main purpose of this study is to evaluate the causal relationship between economic growth and life insurance growth and their effectiveness. therefore, in order to investigate the causal relationship between the growth of life insurance activities and economic growth, the Demteresco and Herlein (DH) causality model has been used for the data panel. We first determined the effect of the economy and the insurance industry by examining the Demetresco Herlin causality test. then, in order to determine the effect of variables on each other, we used the pattern of simultaneous equations of panel data. to solve problems such as heteroskedasticity and heterogeneity, the research equations are estimated in three modes of primary model, resistant to heterogeneity and clustered (resistant to heterogeneity and heteroskedasticity) and in each of the mentioned models by two methods of estimators of instrumental variables (IV) and torque. Generalized Momentum (GMM) is used.
 
4- CONCLUSION & SUGGESTION
Undoubtedly, the economic growth of countries leads to higher per capita incomes. this increase in per capita income will increase the demand for life insurance and consequently the growth of life insurance will have a new impact on economic growth. in other words, with the increase in per capita income, we will see a double impact on economic growth. another indicator that affects the growth of life insurance is the level of education. the higher the level of education will cause the higher growth of life insurance. of course, this positive connection can be due to the increase in public awareness and, as a result, the effort to secure their families' future, as well as possibly the greater demand for urbanization. population growth, which has a positive effect on economic growth, can also be affected by per capita income index, life expectancy and education level. one of the important indicators that has a positive effect on the growth of life insurance is the good governance index. this index includes the index of accountability and the right to comment, political stability, the absence of violence / terrorism, the quality of regulation, the rule of law, the effectiveness of government and the control of corruption. undoubtedly, if the governments of this region pay attention to these indicators, we can expect them to face the growth of demand for life insurance as well as the growth of the economy.

Cities play an important role in population distribution and economic growth. One of the aspects addressed in the urban economics literature is the relationship between urbanization and economic growth. Urbanization is the relationship between population, employment, migration and environment, Given that the economic growth of a geographical area is affected by variables and the effects of overflows of other areas, especially its neighbors, in addition to the spatial dependence created through these variables, the effects that are common to all geographical areas also cause correlation in economic growth of units. They become geographical, so it is necessary to differentiate between the dependence created by these factors and the spatial dependence caused by the spatial effects of variables, because otherwise the role of spatial effects will be more colorful than it really is. Therefore, to control these effects, spatial patterns were estimated once without these effects and once with these effects in 30 provinces of Iran. The results show that even considering the effects of common factors, there is still a positive autocorrelation. There is a gap between the economic growth of the provinces of the country . Results of applying the effects of common factors show is that considering these effects has reduced the intensity of the spatial effect. Also, the results of estimating the dynamic spatial Durbin model indicate that the relationship between urbanization and economic growth of Iranian provinces is inverted U and the effects of urban spillover on economic growth. Neighboring provinces are positive and meaningful.

One of the most important and most trusted tissues in the country is the collection around the holy shrine of Imam Reza (AS), which in addition to the annual adjacency receives more than 20 million pilgrims. Regarding the importance of the issue of renovation and improvement of the worn texture around the holy shrine of Reza (AS) began in 1993, which, unfortunately, has not had significant progress after more than 20 years. One of the most important reasons for the failure of this project is the financing problem, in particular the provision of funds for the construction of public spaces.
In the present study, the willingness of people to participate in the improvement of the worn out texture surrounding the shrine of Imam Reza (AS) through the purchase of bonds was estimated using conditional valuation method. In this way, 240 pilgrims and adjacent people were interviewed. In order to distinguish the factors influencing the decision on participation and the level of participation, the Tobit model and Hackman's two-step method were used. By eliminating incomplete responses, 57 percent of those willing to buy bonds have been deposited. The results of the hacking pattern showed that the variables of trust in local institutions and social consciousness have a significant effect on the decision of respondents to buy papers, and the feeling of belonging to the city and the neighborhood only affects the level of willingness to participate, while the belief in the endowment and the household economic status , Both in the first stage (the decision to pay) and in the second stage (the rate of willingness to pay), has a significant effect. The average willingness to participate was estimated at 1,660,000 rials.

Abstract: One of the most important and vital tissues in the country is the context around the Holy Shrine of Imam Reza. The main problem about this context is the lack of funding for public spaces. In the present study, the willingness of people to participate in the improvement of the worn out texture surrounding the Shrine of Imam Reza is estimated by purchasing waqf bonds and interest-free bonds, using the conditional valuation method. For this purpose, 240 pilgrims and adjacent persons were interviewed. In order to distinguish the factors influencing the decision on participation and the level of participation, two-stage method of Heckman and Tobit model were used. By eliminating incomplete answers, 57% of the people were willing to buy waqf bonds and, 48% of the people were willing to buy interest-free bonds. The results of the Hackit Model showed that the variables of “trust in local institutions” and “social awareness” influence significantly on respondents’ decision to buy bonds. In addition, the “sense of belonging to the city” affects the degree of willingness to participate. In the case of interest-free bonds, the variable of social awareness has a significant effect on the decision of the respondents to participate in it. The variables of sense of belonging to the city and the neighborhood and the household’s economic situation have an impact on the degree of willingness to participate. While the belief in interest-free bonds and the variables of trust in local institutions, both in the first stage (decision to pay) and in the second stage (willingness to pay), have a significant effect on respondents. The average willingness to participate was estimated at 7,450,000 Rials for interest-free bonds and it was 1,660,000 for waqf bonds.

This paper analyzes and compares the behavioral responses of the operator to the fiscal regime of the two types of contracts, Iran Petroleum Contract (IPC) and Production Sharing Contracts (PSC) with using the dynamic optimization approach (dynamic programming method). This paper aims to numerically compute the amount of distortions caused by the petroleum contracts, which creates some distortion in the investor's decision regarding to the neutral case that means there is no contractual restrictions including government share of resource rent, tax, extraction timing, cost recovery limit and so on. The focal point of this paper is the application of the stochastic dynamic programming for a real oil field in order to achieve the numerical results and using the deadweight loss (DWL) as an actual measure for assessment of the distortion of the contract regarding the first best case (neutral path). Accordingly, with using the information of the South Azadegan field, the results show that both fiscal terms of IPC and PSC have distortionary effects and the DWL of the IPC is more than that of PSC. For instance, in the reference scenario and reference oil prices the DWL of IPC and PSC are 22/22% and 21/14% respectively.

This paper simulates and compares the fiscal terms of Iran Petroleum Contract (IPC) and Production Sharing Contract (PSC) for first time. The Scenario approach has been used, in which timing and the volume of investment and production profile are assumed as given and the effects of fiscal parameters of the contract on the key variables such as Internal Rate of Return (IRR) and take of the contractor are computed. This paper uses the technical and economic information of the South Azadegan field (phase II) as a case study for financial simulation. One of the significant results is the possibility of reaching the same economic and fiscal results regardless of the contract type. Another important result of this article is that the IPC fiscal regime is less flexible and progressive than PSC and is less attractive specifically in more capital intensive fields. The reason of this issue is some restriction in IPC such as amortization of the capital costs and having longer payback period and the lack of direct relation between IOC’s fee and the field revenue.

On the factors affecting economic growth and per-capita income, the less attention has been paid to “population age structure”. We aim to investigate the effect of changes in population age structure on per capita income in Iran. To do this, we identify the most important effective channels according to review of literature. Then we design an empirical model that indicates the relationship between population age structure and per-capita income based on the neoclassical growth literature. In the next step we estimate and test the model in three specifications by Auto-Regressive Distributed Lags (ARDL) method during 1968-2010. The results indicate that the per capita income elasticity of labor supply (as the direct effectiveness channel of changes in population age structure on per capita income) is positive. In addition, indirect channels (which include savings, human capital and government spending) indicate that the per capita income elasticity with respect to an increase in share of population between the ages 15 to 64 is positive, and per capita income elasticity with respect to an increase in share of population below age 15 and above age 65 is negative.

Electricity is one of the main inputs in the economic activities especially in industrial sectors. According to Subsidies targeting rule, the sale of electricity should raise the prices to the level of the actual production costs within the fifth development program. This paper uses a computable general equilibrium for measuring the impacts of policy interference on electricity consumption in the industrial sectors of Iran in two scenarios. According to the first scenario, raising electricity price by no change in other energy price, we expect to decrease electricity demand in textile, glass and machinery industries more than other industries. On the second scenario, demand for electricity by the textile, glass industries decrease more than other activities.

Life style has three dimensions: behavioral, attitudinal, and motivational. The current study aims to investigate life style of young in Mashhad from behavioral aspect based on eight factors including cultural consumption, body management, political behavior, derivative behavior, make up tendency, cloths consumption, food consumption, and religiosity. The sample of the current study includes 402 young people who were randomly selected from the city of Mashhad. The utilized instrument in the current investigation is questionnaire. The findings of the present study reveal that there is positive correlation between young people’s life style and their parents’ cultural and economic capital. The results also show that the most significant level of difference, from the stand point of cultural and economic capital, was between people from upper class and people from the lower class of the society.

Crude oil price and the U.S. effective exchange rate are two main economic variables that have had real effects on world welfare situation. The aim of this paper is to test whether there is a stable long-run relationship between oil prices and the U.S. dollar, expressed in real term. To this end, we perform co-integration and causality tests between the two variables, using quarterly data from 1985:1 to 2008:4. Our results show that a 10% rise in the oil price coincides with a 1/8% depreciation of dollar in long-run, and that the causality runs from oil price to the dollar. Furthermore, we estimate the Vector Error Correction Model (VECM) to analyze the short-run behavior of real effective exchange rate and the speed of adjustment when it deviates from its long-run path. Results show that the speed of adjustment is 4/3 percent for each period that means in each period (or each season) the deviation of real effective exchange rate dollar from long-run path shrink to reach its long-run path.

In recent years, protection of intellectual property rights has become more significant. Intellectual property rights can be regarded as the legal rights derived from intellectual activities in industrial, scientific, literature and art fields. Today, most countries seek to find workable models to apply intellectual property for their economic growth improvement. Current study show the effects of intellectual property protection on economic growth through research and development (R&D) expenditures and the number of researchers. Panel data method is used to estimate this effect directly and indirectly for a sample of 35 countries from 1985 to 2005. Research findings showed the protection of intellectual property rights have a positive effect on economic growth directly, and R&D & researchers via intellectual property rights have a positive and significant effect on economic growth indirectly.

In this research, a mass of information of corporations listed in Tehran Stock Exchange has been summarized in terms of measurable indices and then, through numerical taxonomy, all industrial corporations have been ranked and the basis of their degrees of possessing the indices. Time series involved consist of 6 months panels from the beginning of 1380 (Mar. 2001) to the first half of 1383 (Sep. 2004). Theoretical methodology used in the research consists of a factor analysis of indices, and identification of homogenous industries and finally taxonomy. The identification of homogenous and the taxonomy of industries were achieved through numerical taxonomy. According to the research results the investors are in any case advised to make portfolio and not to invest an individual shares. The findings also indicate that during the intended time panels the financial jobbery industries had been of the capital devoting it to buy shares of different kinds, in long term guarantees the investment more and lowers the risk of investment. The results have also shown that having optimal indices has been a relatively stable characteristic of the industries involved and therefor, the investors can make their portfolio through having an eye on the successful industries of the previous periods, because the ranking changes have not been sever in each period.

Creating confidence in the stock market through a secure environment is one of the main achievements of stock markets in the world. In the stock markets of developed countries, there are markets which provide confidence and reduce the risks resulting from the fluctuation of share prices. These markets are called “stock transaction choice markets”. While comparing stock transaction choice contracts and insurance policies, this paper studies the possibility of reducing the risk resulting from stock purchase through insurance policies in the stock exchange market. Having introduced the theoretical framework of the study, we first reviewed the literature using domestic and overseas references. We then collected our data by means of field study. The data were obtained by means of the questionnaires given to the shareholders in the stock exchange hall and analyzed by software. The results indicated that shareholders are inclined to insure their shares and believe that the intervention of the insurance industry in the stock market, as the confidence provision market, can increase the investments. We conclude with some suggestions based on the findings.

Development based on knowledge is in fact a change of perspective and thinking about development. The most important feature of economy based knowledge is the ability to earn income from knowledge-oriented economics. Countries which fix the way of their earning accordingly will certainly gain economic faster growth and higher economic capacities. In this paper we pay close attention to the indexes of knowledge production and the development of wisdom. We also consider some related indexes of this issue. Finally, we examine the influence of related variables on the variables of economic growth in Iran as index of economic performance. By applying the econometric method of ARDL, a long run and a short run model was estimated. The results show that budget and credits allocated to the research sector in the country have significant effect on the growth of internal gross product (without oil) in the period investigated.

It goes without saying that the insufficient transport infrastructure and the inefficient services will directly affect the costs and the time needed for goods to reach destination. An improvement and progress in the country`s infrastructure can make a big difference in the costs of trade. Studies show that a 10 percent increase in the transport costs (largly due to poor infrastructure) has caused a 20 percent decrease in trade.This article tries to quantify the effects of transport infrastructure (rail and road) in the ECO region on the regional trade activities of Iran with other members of the organization. We hypothesize that there is a meaningful and positive relationship between the transport infrastructure and the flow of trade. Utilising panel data and the gravity model, the article shows that the volume of trade will decrease if the transport costs (geographical distance) increase, and the availability of the transport infrastructure increases the flow of trade