Does Market Potential Matter? Evidence on the Impact of Market Potential on Economic Growth in Iranian Provinces

Authors

1 Assistant Professor, Department of Economics, Shiraz University,shiraz,Iran

2 Shiraz University

3 Department of Economics, Faculty of Economics, Management and Social Sciences, Shiraz University, Shiraz, Iran

Abstract

T





he market potential is an indicator showing the level of market access and national demand for products of a region. The aim of this study is to study the effect of market potential on regional economic growth in 28 Iranian provinces over the years 2001–2011. In order to do that, a model of regional growth was estimated by using Spatial Dynamic Panel Data technique. This technique allows us to control for endogeneity biases. Based on the findings, the market potential has a significant positive impact on economic growth of Iranian provinces. This means that as the regional market of products gets bigger, it will experience a higher economic growth.
 

Keywords


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