Intensive and Extensive Margins of Iran's Horticultural Exports: A Gravity Approach

Articles in Press

Document Type : Original Article

Authors
Meysam Matin 1
Roya Eshraghi Samani 2
Hamed Rafiei 3
Bita rahimi badr 1
1 Department of Agricultural Economics, Ka.C, Islamic Azad University, Karaj, Iran.
2 Assosiate professor, Department of Agricultural Economics, Ka. C., Islamic Azad University, Karaj, Iran.
3 Department of Agricultural Economics, Faculty of Agricultural Economics and Development, University of Tehran, Karaj, Iran.
Abstract
This study analyzes the factors influencing Iran's horticultural exports from 2001 to 2023, focusing on market characteristics, trade costs, regional trade agreements, and external economic shocks. Utilizing a gravity framework combined with the two-stage Helpman–Melitz–Rubinstein (HMR) approach, the study distinguishes between the extensive margin (market entry probability) and the intensive margin (export values). Key findings reveal that higher per capita income and larger populations in destination countries positively impact both margins, while increased geographical distance adversely affects both margins. Furthermore, development gaps specifically hinder the extensive margin by limiting market entry. Additionally, economic sanctions and the global financial crisis hinder the extensive margin, affecting new market access, while showing a marginally significant positive association with deeper exports within existing relationships. Regional trade agreements particularly bolster both margins in Asian markets. To ensure sustainable export growth, policymakers should implement three concrete actions: subsidizing first-time export certifications and establishing alternative payment systems to counteract the negative effect of sanctions on the extensive margin; deepening Regional Trade Agreements to reduce non-tariff barriers; and investing heavily in cold-chain logistics to mitigate distance-related trade costs.
Keywords
Economic sanctions
Gravity equation
Helpman-Melitz-Rubinstein (HMR)
Horticultural exports
Market access
Trade margins
Subjects
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Journal of Agricultural Science and Technology

Articles in Press, Accepted Manuscript
Available Online from 13 June 2026