Proceedings of the 25th International Academic Conference, OECD Headquarters, Paris

ECONOMIC GROWTH IN IRAN THROUGH LABOR PRODUCTIVITY GROWTH

NAZAK NOBARI, MAHMOUD ASKARI AZAD

Abstract:

Economic growth is a fundamental measurement to assess a country's performance and productivity. For this reason, growth and productivity are in policy agenda of many countries especially success economic countries. Based on some studies and reports (e.g., those by UK parliament, 2016; OECD, 2012), labor productivity in developed countries is analyzed and considered as a secondary economic growth. In this study, we investigated the relationship between economic growth and change of labor productivity in Iran and their challenges. Our object was to answer to two questions: 1) Is any relationship between level of GPD and labor productivity in Iran? ; 2) What are the driving forces (effective factors) behind the growth of labor productivity? To answer to question 1, economic data from national and international information bank gathered. Relation between GDP and labor productivity examined by calculating some ratios and finally, trends and behavioral patterns analyzed. Patterns drew on Iran’s economic status compared with 10 other countries in regional category (such as USA, Japan, Turkey, and France). Therefore, the study findings revealed that there is a direct relationship between GDP and labor productivity In Iran. To answer to the question 2, initially we developed a conceptual model based on theories and considered labor productivity as complex and multi-dimensional phenomenon (Economic and social dimensions) and assumed labor productivity as a function of internal (organizational) and external (environmental) factors. According to find effective factors, a questionnaire based on conceptual model designed and before evaluating the reliability and validity of questionnaire, it reviewed with 15 academic and professionals. Data collected through questionnaires that distributed to 250 managers and employees from government and non-government sectors. Structural Equation Modeling (SEM) employed, which reported significant and positive relationship between the labor productivity and driving forces such as: competitiveness, size of government sector, unemployment, corruption, social security system (external factors) and Wage/salary, work culture, employee adaptability, employee knowledge and skill, team working, performance appraisal system, career management (internal factors). Whereas, the association between labor productivity and some variables such as sex, age, post and position, sector were not supported. Eventually, challenges based on driving forces that are identified as more effective, discussed. As conclusion findings can be applied by policy makers and managers to make policies to improve labor productivity and increase economic growth rate in Iran.

Keywords: labor productivity, Economic Growth, Effective Factors, Modeling, planning

DOI: 10.20472/IAC.2016.025.045

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