Document Type : ORIGINAL ARTICLE
Authors
Abstract
Expanding non-oil export to get rid of one-product economy has been known as a solution for economic development inIran. Hence, it is necessary to study factors affecting this economic variable. The exchange rate and risk associated with its unexpected volatilities can be noted as the factors affecting export. On this basis, this research aims to investigate the effect of real exchange rate risk onIran’s non-oil export. To do this, the disaggregate data belonging to 13Iran’s trading partners over the period of 1985-2010 was used. The panel data approach was also utilized in the analysis process. Furthermore, to more accurate investigate of this subject, 7 alternative criteria were used to assess the volatility of real exchange rate. The results indicated that the exchange rate risk has a positive and significant effect onIran’s non-oil export in the short-run. This result could be attributed to the positive nature of exchange rate volatility in Iran so that this matter could change the expectations of economic agents, especially exporters, to improve the general trend of real exchange rate.
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