Analysis of Economic and Social Impact of Investment Development Policy in Agricultural Sector

Document Type : Original Research

Authors
P. Zand
H. Mirzaie
H. Mehrabi
S. Nabieian
Department of Agricultural Economics, Shahid Bahonar University of Kerman, Kerman, Islamic Republic of Iran.
Abstract
Capital as the engine of economic growth and development is one of the fundamental pillars of economy. Many developing countries are struggling to achieve sustainable economic growth through investment in order to achieve economic development. Investing in agricultural sector, due to the steady increase in demand for food and other agricultural products, is of particular importance and can lead to growth in production and employment in this sector. In addition, backward and forward relationships of the agricultural sector with other sectors also contribute to the growth of production and employment. Accordingly, in the present study, the analysis of the effects of the policy of investment growth in agriculture based on the method of Social Accounting Matrix (SAM) was considered. The effects of applying this policy (including net, open and closed effects) have been analyzed in three scenarios. The results of net effects showed that the incomes of production activities would be increased in each of these scenarios. In addition, due to the implementation of the first scenario, industrial and agricultural sectors, and because of the implementation of the second and third scenarios, the sectors of industries, agriculture, and horticulture had the maximum increase in production. Also, the study of open effects also shows an increase in the income of the factors of production and institutions caused by the application of the above policies. Investigating the closed effects of the package also showed that the overall economy resulting from the above scenarios increases, such that closed effects are much stronger than direct effects. The findings also showed that the closed effects of the aforementioned scenarios on the industries, services, and commerce were more than the agricultural sector itself and its sub-sectors, indicating a strong link between these sectors and the agricultural sector and its sub-sectors.

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Journal of Agricultural Science and Technology
Volume 21, Issue 7
November and December 2019
Pages 1737-1751