Investigation the role of exchange rate volatility on Iranian pistachio exports

This paper investigates the effect of exchange rate volatility on international trade flows by studying the case of Iranian pistachio exports for the period of 1978 to 2008. Autoregressive distributed lag approach was employed to estimate the main model and generalized autoregressive conditional heteroskedasticity model was used as a measure of volatility to estimate exchange rate volatility. The results show that there exist positive and statistically significant relationship between variables incomes of Iranʹs trading partners and pistachio exports demand. Also, the results show a negative and significant relationship between relative prices and pistachio exports flows. The results of studying of volatility show that exchange rate volatility has had positive and insignificant effect on exports of pistachio. So, Iranʹs agricultural trade policies toward different countries should be developed based on exchange rate fluctuations.