Decline in Productivity in Iran

Radio Farda - June 1st has been designated as Productivity and Consumption Optimization Day in Iran. Mir-Ali Hosseini asked Fereydoun Khavand about the definitions of the two concepts "productivity" and "consumption optimization" and their relationship. Fereydoun Khavand: The two concepts of "productivity" and "consumption optimization" are at the heart of political economy, defined as the science of managing scarce resources. The resources of the Earth, from water and oil to agricultural land, as well as factors of production like labor and capital, are severely limited. In contrast, the needs of the Earth's population, which will reach ten billion in a few decades, are unlimited. We must find ways for humans to utilize limited resources and factors in the best possible way to meet their needs. The work of humans, from the dawn of civilization to today, has been to create tools and make them more complete and complex, increasing their production dozens and hundreds of times with the same amount of labor while improving their standard of living and reducing the consumption of production factors. A well-known example: fifty years ago, an average car needed twenty liters of gasoline to travel one hundred kilometers. Today, it can cover the same distance with four liters of gasoline. Progress is defined this way: increasing the production of wheat, steel, and various services with less labor and resources. Economic power relies on this criterion. Achieving greater welfare through enhancing productivity. What is the status of Iran in terms of productivity and consumption optimization? The decline in productivity is one of the most important indicators of Iran's economic decline. According to statistics published by the National Productivity Organization, from 1997 to 2010, productivity in agriculture fell by 31%, in oil and gas by 17%, and in industry by 38%. During this 13-year period, the productivity index for the entire economy dropped from 100 to 89.5. In the three-year period from 2011 to 2013, according to Ms. Roya Tabatabai, head of the National Productivity Organization, the productivity index for all factors of production decreased by another 3.5%. Productivity and consumption optimization, especially in the field of water, are becoming increasingly important. In terms of water, neglecting productivity and consumption optimization has placed the country in very difficult conditions. Here, the issue goes beyond mere economics and touches on the security and future of the country. Iran has been led to wastefulness in both the management and preservation of its oil resources and in its management of water resources. With these two major wastefulness issues, the recent generations of Iran have inflicted severe damage on the interests of future generations.