Investigating the causal relationship between the illegal farmland conversion and production in all provinces of Iran

The main purpose of this study is to investigate the causal relationship between illegal farmland conversion and production in all provinces of Iran over the period 2011-2015 using Granger-Hsiao, and Toda and Yamamoto causality approach in panel data. In this regard, variables including gross domestic product, labor force, investment, unemployment rate and illegal farmland conversion have been used in the regression model. According to the estimation results, there is a unidirectional causality running from illegal farmland conversion to production, so with an increase in illegal farmland conversion, production increases. This one-way causality is confirmed in both approach. According to the results of the research, policy measures including, calculating the economic value of agricultural land and allocating appropriate agricultural land-use based on this economic value and also passing and implementing effective laws and policies by government are necessary to increase the willingness of farmers on their sustain farming activities.