Financial market development and agricultural economic growth in Iran.

Abstract

Financial market plays a crucial rule in economic development process of Iran. It capitalizes entrepreneurs to undertake new investments or adopt new technologies. It helps smooth consumption by providing working capital and reduces poverty in the process. Following the revaluation in 1979 the government adopted various policies, which encourage farmers to improve their productivity and food self sufficiency has been a national priority. This paper investigates the relationship between development in financial market and agricultural GDP growth in Iran over the period 1979-2005. An econometric model (VAR) was applied to examine the objective of the study. The required Data for this study were extracted from the State Bank of Iran and Iranian Statistical Yearbook, 1980-2005.

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