Hakimian, Hassan2017-08-282017-08-282008https://hdl.handle.net/10986/28004Debates over the nature and direction of economic policy in Iran have intensified rather than abated after the tumultuous changes brought about by the revolution in 1979. In the span of these three decades, Iran has witnessed sweeping institutional changes and has been affected by significant economic and political upheavals. At the macroeconomic level, too, there have been a number of shocks ranging from oil booms and busts, to war (with Iraq), trade sanctions, and internal political strife. This paper uses Iran's experience to reflect on growth and development in the context of political upheaval and an uncertain institutional environment. It is a premise of the paper that Iran's recent past presents a rare, 'laboratory' like, case for the study of growth and development in a broad context. This paper examines post-revolutionary Iran's macroeconomic policies and performance in a comparative context, appraising it against Iran's past trends and real potential. It shows how recurrent cycles of populism and pragmatism have characterized this period. The paper argues that two sets of factors have conditioned Iran's performance and will continue to taint her prospects for sustainable growth into the future. These are: (i) Iran's limited economic diversification and continued dependence on the oil sector, and (ii) the institutional setting in which post-revolutionary economic policies have been formulated and implemented for much of the last three decades.en-USCC BY 3.0 IGOADVERSE CONSEQUENCESAGGREGATE DEMANDAGRICULTUREANNUAL % GROWTHANNUAL GROWTHANNUAL IMPORTSAVERAGINGBALANCE OF PAYMENTSBALANCE OF PAYMENTS CRISESBANK CREDITSBANK LOANSBANKINGBANKING SYSTEMBILLBILLSBLACK MARKETBONDSBRAIN DRAINBUDGET DEFICITBUDGET DEFICITSCAPITAL ACCUMULATIONCAPITAL GOODSCENTRAL BANKCLARITYCOMMODITIESCOMMUNICATIONCOMPETITIVENESSCONSOLIDATIONCONSUMER PRICE INDEXCONSUMPTION EXPENDITURECORRELATION COEFFICIENTCORRELATION COEFFICIENTSCREDITCURRENCYCURRENCY CRISESCURRENT ACCOUNTDEBTDEBT CRISESDEBT CRISISDEBT SERVICEDEBTSDECISION MAKINGDEFICITDEMOCRACIESDEMOCRACYDEMOGRAPHICDEMOGRAPHIC CHANGEDEPOSITDEPOSITSDEPRESSIONSDEVELOPING COUNTRIESDEVELOPMENTDEVELOPMENT AGENCIESDEVELOPMENT PATHDEVELOPMENT PROJECTSDISTORTIONSDIVIDENDDOMESTIC MARKETDOMESTIC MARKETSDOMESTIC SAVINGSECONOMIC BOOMECONOMIC CRISISECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC HISTORYECONOMIC INTEGRATIONECONOMIC ORDERECONOMIC POLICIESECONOMIC POLICYECONOMIC REFORMECONOMIC REFORMSECONOMIC RESEARCHECONOMIC RESOURCESECONOMIC STRUCTUREECONOMIC TRENDSECONOMIESECONOMYEMPLOYMENT POLICYEQUILIBRIUMEQUITYEXCESS LIQUIDITYEXCHANGEEXCHANGE RATE DETERMINATIONEXCHANGE RATE REGIMEEXCHANGE RATE SYSTEMEXCHANGE REGIMEEXCHANGE RESTRICTIONSEXPECTATIONSEXPORT REVENUESEXPORTSEXPOSUREEXTERNAL DEBTEXTERNAL EQUILIBRIUMFINANCIAL CRISISFINANCIAL REFORMSFISCAL POLICIESFISCAL REFORMSFOREIGN CAPITALFOREIGN COMPETITIONFOREIGN DEBTFOREIGN DIRECT INVESTMENTFOREIGN EXCHANGEFOREIGN EXCHANGE CONTROLSFOREIGN EXCHANGE POLICYFOREIGN EXCHANGE RESERVESFOREIGN INVESTMENTFOREIGN LOANSFOREIGN TRADEFUTUREGDP PER CAPITAGLOBALIZATIONGOODSGOVERNMENT BUDGETGOVERNMENT SUBSIDIESGROWTH PERFORMANCEGROWTH POTENTIALGROWTH RATEGROWTH RATESHIGH INFLATIONIMBALANCESIMPORTIMPORT COMPRESSIONIMPORTSINCENTIVESINCOMEINCOME GROWTHINCOME LEVELSINCOMESINDUSTRIALIZATIONINEFFICIENCYINFLATIONINFLATION RATEINFLATIONARY PRESSURESINSTITUTIONAL ENVIRONMENTINSURANCEINTERESTINTEREST RATESINTERNATIONAL BUSINESSINTERNATIONAL ECONOMYINTERNATIONAL MARKETINTERNATIONAL MARKETSINTERNATIONAL RESERVESINTERNATIONAL TRADEINVESTMENTINVESTMENT CLIMATELABOR MARKETSLDCSLIBERALIZATIONLIQUIDITYLIVING STANDARDSM2MACROECONOMIC BALANCEMACROECONOMIC CONDITIONSMACROECONOMIC INDICATORSMACROECONOMIC LEVELMACROECONOMIC MANAGEMENTMACROECONOMIC PERFORMANCEMACROECONOMIC POLICIESMACROECONOMIC POLICYMACROECONOMIC REFORMSMACROECONOMIC STABILITYMACROECONOMICSMANAGERIAL EFFICIENCYMIDDLE INCOME COUNTRIESMONETARY EXPANSIONMULTIPLE EXCHANGE RATENATURAL RESOURCENATURAL RESOURCESOIL ECONOMIESOIL ECONOMYOIL EXPORTOIL EXPORTEROIL EXPORTSOIL MARKETSOIL PRICEOIL PRICESOIL REVENUEOIL REVENUESOUTCOMESOUTPUTOWNERSHIPPAYMENTSPER CAPITA INCOMEPOLITICAL ECONOMYPOLITICAL STRIFEPOLITICAL UPHEAVALPOLITICAL UPHEAVALSPOPULATION GROWTHPOSTWAR PERIODPOSTWAR YEARSPOVERTY REDUCTIONPRICE CONTROLSPRICE FLUCTUATIONSPRICE INCREASESPRICESPRIVATE CONSUMPTIONPRIVATE PROPERTYPUBLIC FINANCESRAPID GROWTHREAL GDPREAL GROWTH RATESREAL INCOMERECESSIONREFORM PROGRAMREJECTIONSHARESHORT-TERM DEBTSHORT-TERM TRADESHORTFALLSLOW GROWTHSTRUCTURAL REFORMSSUBSIDIESSUBSIDYSUPPLYSUPPLY SIDESUSTAINABLE GROWTHTAX REFORMSTOTAL EXPORTSTOTAL INVESTMENTTRACK RECORDTRADETRADE BALANCETRADE FINANCETRADE POLICYTRENDSTROUGHUNCERTAINTYUNDUE INFLUENCEUNEMPLOYMENTUNIVERSAL SUFFRAGEVARIABLESVOLATILITYWEALTHWHOLESALE PRICE INDEXWORLD DEVELOPMENT INDICATORSWorking PaperWorld Bank10.1596/28004