Study of comparative advantage for sugar beet production in Iran

Abstract

The main objective of this study is to investigate the comparative advantage for Sugar beet production in Iran. Sugar beet is one of the main crops which is considered as an important resource for energy supply. The importance of sugar beet (as a sugar source) in Iranian household food basket, price fluctuation and consumers' demand for sugar beet, social profitability and the impact of government polices and national market limitations on sugar beet growers was investigated using Policy Analysis Matrix (PAM) method in Iran for 2006-2007 growing season. The data of the study was obtained from documentary studies. The results of the Policy Analysis Matrix showed comparative advantage in sugar beet production in Iran (DRC=0.55). The nominal protection coeffi-cient of the product also showed an indirect tax on sugar beet production (NPC=0.77), while Nominal protection coefficient of input indicates an indirect tax for inputs (NPI=2.55). However, effective protection coefficient proves that the indirect tax for sugar beet crop exceeds the corresponding subsidies paid by government to inputs. Therefore, government should plan to reform and to improve the inputs subsidy system to raise the efficiency.

Keywords

• comparative advantage
• iran
• policy analysis matrix
• sugar beet