Application of Spatial Econometrics in Agricultural Exports in ECO Members: Panel Data Approach

According to trade theories، economic integration results in increasing trade and income among trade partners. This paper tries to test the major factors affecting the exports of agricultural products in ECO members using spatial econometric approach. For this purpose، the exports statistics of ECO members has been used in the form of panel data during 1992-2008. Agricultural exports function has been estimated using the Static (fixed and random effects) and Dynamic (generalized method of moments (GMM)) methods in panel data with classic and spatial econometric approaches. The estimated results indicate the existence of spatial dependence among the countries، so the using this estimation procedure is justified. GDP، Exchange rate and spatial variables (such as proximity) have positive effects and Population has negative effect on agricultural exports. Finally، it is suggested that the estimation equations should consider the proximity between the countries and with the increase in the exchange rate and GDP، increase exports in order to provide the necessary basis. Population control policies may also apply.