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Title: Oil, manufacturing efficiency and economic growth in Iran : a microeconometric approach
Author: Kazemi Najaf Abadi, Majid
ISNI:       0000 0004 5346 7093
Awarding Body: SOAS, University of London
Current Institution: SOAS, University of London
Date of Award: 2014
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This research provides a microeconometric study of production efficiency in Iranian manufacturing sector within a broader political economy context which helps delineate the conditioning factors that are included in the model. The study is also a contribution to the literature on economic growth in oil rich economies. The existing literature mainly discusses the impact of oil revenues in terms of either sectoral misallocation of resources away from traded goods sectors or underinvestment in production sectors. We argue that these models fall short of explaining the growth experience of oil economies such as Iran. We show that the main obstacle to Iran's economic growth is the inefficiency of investment. This is done by measuring production efficiency in the manufacturing sector using firm-level data. We assess the context of Iranian political economic structure and the importance of factors that can explain efficiency. We look at the productivity of Iranian economy and compare it with the performance of South Korea and Turkey. Our findings suggest that the productive performance of Iran has deteriorated not only in comparison to these countries but also with regards to its own trend prior to the 1979 revolution. To establish the reason for this dismal performance, we explore the production efficiency of the Iranian manufacturing sector. We find production efficiency for manufacturing producers in 2007 to be around 66%. Our results also confirm that some of the institutional features of the Iranian economy play a significant role in explaining production efficiency. These are characteristics of firms that benefit most from higher subsidies and support from the oil revenues. We also find that firms that export and those that are larger tend to be more efficient. These findings have important policy implications, most notable of which is the creation of a more competitive environment for successful long-term growth.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available