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Employment Functions and its Estimation and Forecast across Economic Sectors in Iran\'s Sixth Development Plan (in Persian)

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  • Amini, Ali Reza

    (Islamic Azad University, Science and Research Branch,)

  • Farhadikia, Ali Reza

    (Affairs of the Country's Planning and Budget Organization,)

Abstract

This paper aims to analyze factors affecting employment across nine economic sectors in the economy of Iran over the period of 1973-2011. Based on the results of dynamic models used for ARDL estimation of employment functions across all economic sectors, it is revealed that production variable has had a positive impact on employment and per capita capital, where as an index of relative cost of employing labor(w/r), bearing a negative impact on employment. Moreover, the impact of Total Factor Productivity, treated as an index of technology, on demand for labor has been negative and statistically meaningful for agriculture, industry, utilities (electricity, gas and water), telecommunications and other service sectors. As such, it is concluded that growth in production plays a significant role for growth in employment generation, but one should not overlook the negative impact of per capita capital and technological progress on labor employment. Estimations based on employment functions indicate that if average growth is achieved at 8% per annum, during the Sixth Development Plan, the average net annual job creation will be around 949,000 and the unemployment rate will fall to 9%.

Suggested Citation

  • Amini, Ali Reza & Farhadikia, Ali Reza, 2017. "Employment Functions and its Estimation and Forecast across Economic Sectors in Iran\'s Sixth Development Plan (in Persian)," The Journal of Planning and Budgeting (٠صلنامه برنامه ریزی Ùˆ بودجه), Institute for Management and Planning studies, vol. 21(4), pages 61-100, March.
    • Handle: RePEc:auv:jipbud:v:21:y:2017:i:4:p:61-100
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