Analysis of R&D's Role on Transport Sector Growth in Iran Using Endogenous and Exogenous Growth Patterns

The transport sector as a prerequisite and foundation for development plays an important role in creating facilities and potential opportunities. Identification of the factors affecting the development of this sector can assist in the optimal use of the transportation sector’s capacity, as well as determination of policies aimed towards increasing the sector’s efficiency. The objective of this paper is to perform an analysis of the role of research and development in the growth of the transport sector. This analysis is based on exogenous and endogenous growth patterns and empirical studies, which are used to identify the required variables and role of the economic model for R&D expenditure on growth within the transport sector in Iran. Finally, these models are estimated using appropriate econometric techniques. According to both of these models, the labour force, rate of investment and the ratio of investment to capital stock have a positive and significant effect on the growth of the transport sector.The variables of ratio of the research credit to value-added of transport sector, index of degree of openness of the economy, changes in the price index of goods and service sector as well as the degree of government intervention also have a positive and significant role on the studied field. Dummy variables for the periods of war and revolution have a negative effect. According to the research findings, if a person is employed as an expert or specialist in the research and development sector, the knowledge rate will grow by 0.0382%, which will ultimately lead to an increase in the value added variable of growth rates for the transportation sector to 0.0494%. In another model, increasing rates of investment in R&D will result in an increased growth rate of transport to 0.042. Finally, variance decomposition of forecasting errors shows that variation in the labour force employed in occupations that are scientific, technical, and specialized have a slight role in variation of the value added variable for the transportation sector.