The Fundamental Impediments of Economic Growth in Iran: An H-R-V Model

Iranian economy has had a long history of development efforts. It’s now more than sixty years passed from the official attempts in development of the country through the so called economic, social, and cultural development plans. Iran has of course gained the fruits of modern economic era to some extent. However as a fact of observation, Iranian economy has not experienced a sustained economic growth during these many years of the attempts for economic development. The important question is why? This article introduces the framework of a model that intends to clarify the fundamental impediments of Iranian sustainable economic growth and tries to provide an answer, as reasonable as the constraints of the model permits. The model, maintaining the message of H-R-V model, extends it to the Iranian economic growth in a broader perspective. While we recognize the pathology of price distortions and activist policies, we observe the Iranian main development problems on some important binding constraints. In fact in this expanded perspective, instead of governments, the lives of whom are short, “governance”- be it in a market or a non market economy- is at the center of the attention.