Kerman province is the first in the area of production and cultivation of pistachios in Iran. In this study, a number of 162 samples were collected using ‘cluster sampling’ from Kerman province in 2009 to analyze the policy effects and the comparative advantage of pistachios production in the province. The comparative advantage was computed through Policy Analysis Matrix (PAM). Domestic Resource Cost (DRC), Social Cost-Benefit (SCB), Nominal Input Protection Coefficient (NPIC), Nominal Protection Coefficient (NPC), Effective Protection Coefficient (EPC) and Net Social Profit (NSP) were the indices used in the study. The results show that the production of pistachios was a comparative advantage in Kerman province. Meanwhile they revealed that although the government supports the inputs market of the product, its sales market is not supported in any way. In the mean time, the findings indicate that the government’s intervention in the inputs or sales markets of the product would be harmful for the producers. The study shows that production and exports of pistachios are profitable in free competition terms.

Keywords: Kerman, Policy Analysis Matrix, Pistachios, Comparative Advantage

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