Analysis of increasing rice import tariff on welfare and poverty of the Iranian rural and urban regions

A brief review of Iranian socio-economic literature clearly implicates prolonged poverty. In this regard, a number of measures performed in the framework of five-year development plans by focusing on agricultural and food markets reform for dampening rural and urban poverty, especially in the post-revolution years. Rice has played an important role in production pattern and in consumption basket of Iranian people; hence, this study tries to quantitatively analyze increasing rice import tariffs on rural and urban welfare and poverty by developing a multi market spatial price equilibrium model. Results showed that the effects of such a policy among regions are subject to rural and urban circumstances and their net seller and net buyer position. However, Iran as a whole is a net buyer country. Therefore, any tariff increase deteriorates consumers’ welfare and poverty rather than improving domestic production and producer surplus.