The Incidence of Dutch Disease in the Agriculture Sector of Iran 1367-1386

Abstract

This paper examines the incidence of Dutch Disease symptoms in the agriculture sector of Iran, by applying SVAR modeling to quarterly data of twenty years span, from1367-1386 our findings do not reveal any significant relation between oil prices, and value added of agriculture sector, but indicate a significant negative effect of oil price on the relative price of agricultural products. Therefore, the incidence of Dutch Disease cannot be rejected. Although it seems that protective measures, in some extent, have been succeeded in insulating the production from harmful effects of decrease in the relative prices, but these measures, in no way will ensure the future development of the agriculture sector.

Keywords

• agriculture sector
• dutch disease
• iran
• oil prices
• svar