Oil and Non-oil Export, Non-export Sector and Economic Growth: New Approach to Feder Economic Growth Model

Abstract

 The income produced from oil export has a considerable role in the economic sectors of Iran such as non-oil export, non-export sector and economic growth. This article used an extended version of Feder model (1982) to estimate the effects of oil and non-oil export in non-export sector and economic growth process in Iran since 1978-2011. The results suggest that oil export and non-oil export have a positive significant effect on the economic growth. Further, it shows that oil export has a positive significant externality effect on non-oil exports and non-export sectors. Also, non-oil export has a positive significant externality effect on non-exports sector.

Keywords

• oil exports
• economic growth
• non-oil exports
• vecm