Document Type: Original Article

Authors

Department of Agricultural Economics, Shahid Bahonar University of Kerman, Kerman, Iran

Abstract

Investment in the agricultural sector is important because this sector greatly affects the realms of providing food independence and security, employment, sustainable development, and environmental preservation. So, this study investigated the socio-economic impacts (direct and indirect effects) of the investment development policy on the agricultural sector and its sub-sectors in Iran in 2011 using a social accounting matrix (SAM). The results included three scenarios including a 15% increase in investment in the agricultural sector, a 10% increase in the investment in the farming and gardening sub-sector, a 15% increase in the investment in the farming and gardening sub-sector, and a 10% increase in the investment in the other sub-sectors. They indicated that the total income of the economy was increased when these scenarios were implemented; however, the first scenario had a greater impact on the total income of the economy (13.12%) compared to the other scenarios. Furthermore, it can be said that the sectors of agriculture (2.98%) and industry (0.36%) were most influenced by the first scenario and the sub-sector of farming and gardening and the industrial sector were most influenced by the second and third scenarios. According to the results of this study, it is suggested to take some actions to develop crop insurance and secure investment against potential losses by the available risks in the agricultural sector. Moreover, the government can play an influential role in controlling inflation and preventing price fluctuations so as to assure and motivate investors to increase investment in the agricultural sector.

Graphical Abstract

Highlights

  • Increase of the total received income of the economy as a result of increased investment in agriculture and its subsectors
  • Increase of employment and reduce of inflation as a result of increased production
  • Increase of the income of the families as a result of increased investment in agriculture and its subsectors

Keywords

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