3.Discuss about the Iranian Economic Development historically in accordance with Rostow’s Model.

For Iran, it seems that Rostow’s traditional society stage is the period before 1925 (before 1304 AHS) when Iran was an agricultural society. By 1925 The country had not experienced substantial industrialization and economic transformation indeed. Prior to 1925, products were almost entirely consumed rather than traded or swapped by barter and exchanged by each other, demonstrating the lack of international trade. At that time, production was also labor-intensive and the use of capital and technology were limited. Iran underwent a period of social change, economic growth, and relative political stability in the Pahlavi Era, between the years of 1925 to 1967 (1304-1346), reaching the second stage of Rostow's model. Reza Shah Pahlavi improved the country's overall infrastructure, implemented educational reform, campaigned against foreign influence, reformed the legal system, and introduced modern industries. changes in the legal system, tax structure, and trade policies attracted domestic financial resources and led to the emergence of a group of new, young entrepreneurs. Furthermore, Increased investment in mining, construction, and the manufacturing sector occurred, and infrastructure investment grew significantly. The government also managed the expansion of international trade but despite many advances in domestic and foreign economic policy, however, Iran remained an exporter of raw materials and traditional goods and an importer of both consumer and capital goods in the years before World War II. Between 1954 and 1960, during the reign of Mohammad Reza Pahlavi, a rapid increase in oil revenues and sustained western foreign aid led to greater investment and fast-paced economic growth, primarily in the government sector. With a considerable emphasis on industrialization, from 1962 to almost 1967, government programs included a wide range of incentives to encourage investment in new industries by both Iranian and foreign businesses. Most new investments were made in collaboration with the public sector, international investors or private businesses and foreign corporations. Investment in roads, highways, dams, bridges, and seaports also increased. With government support, part of the agricultural sector also attracted significant investment. And, many large-scale agricultural operations in meat, dairy products, and fruit production were established. As a result, the third stage (take-off) was attained. Under the economic development plans from 1968 onwards, the Iranian economy became increasingly open to imports as far as a flood of imported goods and raw materials overwhelmed the capacity of seaports and warehouses, and foreign investment and oil revenues also grew up. In the wake of the spike in crude oil prices, the process of industrialization and consumption grew rapidly. Economic growth, however, became increasingly dependent on oil revenues in the 1970s. By 1977, Agriculture, traditional and semi-traditional industries, and the services sector did not experience a uniform pattern of growth, different from what manufacturing industries experienced, which benefited from strong government support. Following the nationalizations in 1979, and the outbreak of the Iran–Iraq War, over 80% of Iran's economy came under the control of the government. After the end of hostilities with Iraq in 1988, the Islamic government tried to develop the country's communication, transportation, manufacturing, health care, education, and energy infrastructures (including its prospective nuclear power facilities) and has begun the process of integrating its communication and transportation infrastructure with that of neighboring states, but at the end of the 20th century, the country's economic future faces many obstacles. It seems that from 1968 (1346 AH) until today Iran has not been able to enter Rostow’s maturity stage.