Has Iranian Emigration been reducing Iran’s Intra industry Trade?

Abstract

The growing wave of Iranian emigration has raised the question of how the process of migration to the mainly developed destinations, has an impact on the country’s foreign trade pattern. It seems that the migration of Iranians has caused serious losses for the country and the technical, scientific and economic capacities required by the country have been provided to the migrating countries, especially the developed ones, and in return, the emigrating of Iranians, who generally have knowledge, labor and capital, has led to the country's economic decline. Since intra-industry trade is sensitive to the components of technology and competitiveness, the main purpose of this study is to test the hypothesis that the outflow and one-way migration has caused a decline in Iran’s intra-industry trade. For this purpose, the gravity panel data model with a logistic transformation for Iran with the main destinations of Iranian emigrants in the period of 2000-2018 has been used. The findings of the present study confirm the negative and significant effect of the unilateral trend of Iranian migration to the main destinations on intra industry trade of Iran with these countries. Accordingly, in order to prevent serious losses, it is strongly recommended that the worrying process of migration should be considered by policymakers and in this regard, a specific strategy in relation to international migration be established in national interests.

Keywords

• immigration
• intra industry trade
• iran
• top destinations of iranian emigrants
• augmented gravity model
• logistic transformation