Export Expansion And Economic Growth;Evidence From Iran, After 1979 Revolution

This paper investigates the relationship between export expansion and economic growth over the entire period of after 1979 revolution for Iran. A modified granger methodology employed by Bahmani-Oskooee et al (1991) who followed Hsiao’s Granger-Akaike synthesis in their research is utilized. The paper begins with the investigation of causal relationship between exports and growth by employing the time series techniques of causality for Iran. In a production function framework, a model is then tested, which is also compatible with the new growth theory. The findings suggest that exports contributed to the rate of economic growth, and support the importance of export for Iranian economic growth in terms of both real GDP and net-real GDP for the period of after 1979 revolution. Therefore, the primary conclusion that emerges from this study is that while exports have emerged as a growing component of Iranian economic activity in recent years, the export sector can be said to have an important role in promoting economic growth for the country.