Investigating the Effect of Input Consumption on Selected Grain Production in Iran

Identifying the impact of consumption of different inputs on agricultural production helps to provide the right information to the policymaker. This study aimed at estimating the production function of two basic products (irrigated and rainfed wheat, and rice) using the three-dimensional spatial panel pattern (product, province and time). The required information was collected for the 30 provinces of Iran in the period from 2006 to 2018; and according to the selection criteria of the production functions, the translog function was selected as the superior function. Due to spatial effects and diagnostic tests, the spatial correlation model was evaluated as the optimal model. The study results showed that the elasticity of cultivated area, consumption of pesticides, tractors and combine harvesters to the production of irrigated wheat, rainfed wheat and rice products was positive and the elasticity of labor, consumption of seeds and fertilizers to the production of these products was negative; in addition, the elasticity of production inputs did not change significantly over time, and the trend of impacts of the production inputs on the production of the studied products was almost constant. Due to the surplus of labor in the production of these three products, the withdrawal of labor from production in this sector should be on the agenda and more investment should be made in investment factors such as combine harvesters and tractors to increase production so that the country can achieve self- sufficiency.