Analysis of labor productivity of Irrigated wheat in Iran: Panel data approach

The emphasis of policymakers on food security is through increasing the production of strategic products such as wheat. Therefore, the government pays a lot of subsidies for this product. Since labor has a large share in the production of agricultural products, including wheat, the growth of labor productivity can increase the productivity of the total factors and reduce production costs, followed by the cost price. Therefore, the main goal of this study is to analyze the productivity of labor in the production of irrigated wheat in the provinces of Iran in the period 2000-2019. To achieve the goal, partial productivity of labor in irrigated wheat production was measured in 30 provinces and 10 climatic regions based on FAO zoning and then a regression analysis method based on panel data was utilized to determine the factors affecting labor productivity. The results showed that the provinces of Kermanshah, Khuzestan, and Ardabil had the highest labor productivity and Yazd, South Khorasan and Sistan, and Baluchestan provinces had the lowest labor productivity among all the provinces. Econometric tests in regression analysis showed that the best model compatible with panel data is the cross-section fixed effects model with dummy variables of the region and two slope variables. The results showed that the variables of the percentage of improved seeds, percentage of machine use, annual rainfall, and number of annual irrigations in Khuzestan and Caspian coastal regions had a positive and significant effect on labor productivity in irrigated wheat production, whereas, intermediate input (including pesticides and fertilizers) had a negative and significant effect on it. So, it is suggested to increase the level of mechanization and the use of improved seeds, as well as investment in modern irrigation systems, to increase the labor force's productivity in the production of irrigated wheat. Also, the economic amount of poison and fertilizer consumption should be determined more accurately.