Can Agriculture Be Considered a Key Sector for Economic Development in an Oil Producing Country? The Case of Iran

In the light of the 2008 World Development Report, this paper revisits the impact of agriculture on overall economic growth, in the case of an oil producing country, using indices of intersectoral linkages. To this end, four input-output tables of Iran’s economy are utilized. The results support the importance of the agricultural sector in stimulating the economic growth of Iran, but also show that the manufacturing sector has a higher potential to increase domestic production through its intersectoral linkage effects. Consequently, the results provide a caveat to the recommended general policy of the World Bank that the agricultural sector can be considered a key sector for the economic development in developing countries, at least in an oil producing country like Iran.