Abstract
To comprehend the magnitude of change and economic development of any country, we have no choice but to revert to history and culture and examine the past and intrinsic attributes to understand present and prevailing norms and traditions. As a noun, development means betterment, a progression of sorts, and as such it is inherently part of evolution of the human community. Although there are different perspectives on what development is, the common element that these views all share is the notion of improvement, be it in the form of an increase in wealth/income for a portion of the population, secure and sufficient resources for living, or alteration of social conducts. However, it is utterly erroneous to believe that development as such can be attained without overall alteration of structures of power relationships in a country. This is mainly because wealth cannot be increased and more evenly distributed without affecting the existing structures of power relationships in the country. More to the point, economic development cannot be thought of as an enterprise separate from politics, as conventional wisdom would have it, but rather as the most significant source of politics.
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Notes
- 1.
Buchanan JM (1977) The Collected Works of James M. Buchanan, Foreword by Robert D. Tollison, 20 vols. (Indianapolis: Liberty Fund, 1999–2002). Vol. 8 Democracy in Deficit: The Political Legacy of Lord Keynes, Chap. 7, Introduction.
- 2.
See Appendix on Development.
- 3.
This characterization may offend some who believed that the democratic process is a universal notion. Similarly, there are those who view Reza Shah as a dictator and hence dismiss his achievements. Elsewhere in this study I have presented my reasons for rejecting the notion of universality of democracy . However, in the case of Reza Shah’s dictatorial style of governance, I find myself in complete agreement with such sentiment. In fact, I believe Reza Shah, in the end, became one of his own victims, a classical case of progressive corruption by absolute power, which is almost the norm in our history and that of many others. Having said that, his achievements, considering the short time-span of his power, are unmatched in our history and hence must be acknowledged.
- 4.
Shuster WM (1912) The Strangling of Persia: A Personal Narrative. The Century Company, New York, p. xxiii.
- 5.
Ibid., p. iii.
- 6.
Issawi C (ed) (1971) The Economic History on Iran 1800–1914. University of Chicago Press, p. 67.
- 7.
Jenks L (1927) The Migration of British Capital. Knopf, p. 273. For a more detailed discussion of this topic, see Chap. 9.
- 8.
Shuster WM (1912) The Strangling of Persia: A Personal Narrative. The Century Company, New York, p. xv.
- 9.
Cottam RW (1979) Nationalism in Iran. University of Pittsburgh Press, p. 122.
- 10.
Avery P, Hambly G, Melville C (eds) (1991) The Cambridge History of Iran (Vol. 7): From Nadir Shah to the Islamic Republic. Cambridge University Press, Cambridge.
- 11.
deFronzo J (2010) The Iraq War: Origins and Consequences, p. 15.
- 12.
Bourdillon BH (1924) The Political Situation in Iraq. Journal of the British Institute of International Affairs 3(6), p. 281.
- 13.
Marr P (2004) The Modern History of Iraq. Westview Press, p. 26.
- 14.
In some sources the war refer to the Turkish-Armenian, Franco-Turkish, Greco-Turkish wars, but also denote as the Eastern Front, the Southern Front, and the Western Front of the war, respectively.
- 15.
Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 137.
- 16.
For one thing, Shah’s family status does not convey any historical significance; it neither adds to our understanding of the era nor justifies his unlawful conduct. While Shah’s conduct must be condemned, his childhood socioeconomic status has no relevance to any discussions of his rule, except an over-the-counter psychoanalysis of the man.
- 17.
According to Cyrus and Sirus Ghani, “there is no existing or available record of Reza’s [Khan] service until 1911. There are references by several Iranian writers to Reza Khan having served as a guard at either the Dutch, Belgian, or German Legation. Although there is no convincing evidence of such service it should not be entirely discounted. In 1911, serving under the overall command of Farmanfarma, Reza Khan took part in a battle against Salar al Dowleh who was attempting to topple the government in Tehran and reinstate his brother Mohammad Ali on the throne. Reza [Khan] gave a good account of himself in that campaign and was promoted to First Lieutenant.” (Ghani C, Ghani S (2000) Iran and the Rise of the Reza Shah: From Qajar Collapse to Pahlavi Power, I. B. Tauris, p. 162–163).
- 18.
Adel GH, Elmi MJ, Taromi-Rad H (eds) (2012) The Pahlavi Dynasty: An Entry from Encyclopedia of the World Islam. EWI Press, p. 4.
- 19.
Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 102.
- 20.
Ibid., p. 103.
- 21.
Ibid., p 114.
- 22.
Katouzian H (2004) State and Society under Reza Shah. In: Atabaki T, Zu¨rcher EJ (eds) Men of Order: Authoritarian Modernization under Ataturk and Reza Shah. I. B. Tauris & Co, p. 17. For similar observations, see Encyclopaedia Britannica at http://www.britannica.com/biography/Sayyid-Zia-od-Din-Tabatabai as well as Islamic Revolution Document Center in Iran at http://www.irdc.ir/en/content/24457/print.aspx.
- 23.
According to Ali Ansari, “Antipathy towards the tribes was fuelled not only by anxieties about internal security and a determination to monopolise the means of coercion but also by their increasing characterization as being beyond the pale of normative civilisation, not only by European standards but also by Iranian standards which identified them with the traditional enemy of the Iranians, the Turanians. This center-vs-periphery argument was furthermore to be increasingly defined in racial terms such that the ‘tribes’ were frequently, if incorrectly characterised as ‘Turkic’ (for all practical purposes and common usage, Turks). Such views were reinforced by the Qashqai revolts in the early 1930s, and of course the association with the Qajars who were likewise ‘tribal’ and ‘Turkic’.” (Ansari AM (2012) The Politics of Nationalism in Modern Iran. Cambridge University Press, p. 85).
- 24.
In fact, as the British envoy in Iran, Sir Percy Loraine, stated: “With Sardar Sepah [Reza Khan] out of the picture, the risk of conflict with Bakhtiaris and Sheikh Khazal would disappear … [and his plan] to dominate the south will disappear.” (Ghani C, Ghani S (2000) Iran and the Rise of the Reza Shah: From Qajar Collapse to Pahlavi Power, I. B. Tauris, p 261).
- 25.
Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 131.
- 26.
Katouzian H (2005) Reza Shah’ political legitimacy and social based, 1921–1941. In: Cronin S (ed) The Making of Modern Iran: State and society under Riza Shah, 1921–1941. Taylor & Francis e-library, p. 18–19.
- 27.
Katouzian H (2004) State and Society under Reza Shah. In: Atabaki T, Zu¨rcher EJ (eds) Men of Order: Authoritarian Modernization under Ataturk and Reza Shah. I. B. Tauris & Co, p. 18–19.
- 28.
Azimi F (2008) The Quest for Democracy in Iran: A Century of Struggle against Authoritarian Rule. Harvard University Press, p. 82–83. For an informative analysis of Sardar As’ad life, see Cronin S (2005), Reza Shah, the Fall of Sardar Asad, and the ‘Bakhtiyari Plot’. Iranian Studies. 38(2):211–245.
- 29.
For instance, Mohammad Gholi Majd, Great Britain and Reza Shah. The Plunder of Iran 1921–1941 is a typical straight condemnation of Reza Shah that lacks any nuance in its verdict. This book, according to Yann Richard, “contains no sentence in which Reza Shah’s actions come off as simply neutral or as having entailed any positive consequences for Iran’s economy or society. All is bad and destructive.” (See Richard Y (2006) Reviewed Work: Great Britain and Reza Shah. The Plunder of Iran, 1921–1941. Iranian Studies 39(2), p. 278).
- 30.
For instance, Ervand Abrahamian stated: “The regime failed in one major area: public health. With the exception of Abadan, an oil company town, other cities saw little of modern medicine and sanitation in terms of sewage, piped water, or medical facilities.” (Abrahamian E (2008) A History of Modern Iran. Cambridge University Press, p. 90).
- 31.
The point is that expectations of what Reza Shah could have achieved within the 15 years of his reign must be made in light of the existing condition, to which Morgan Shuster had observed: “There had never been any attempt made [a decade prior to Reza Khan descending from the throne] at centralizing the revenues in order that the Government might know just what it should receive from its various taxes and what it did not receive; nor was there any attempt to control the expenditure of such funds … I soon learned that no budget existed … It is enough to state at this time that the Minister of Finance found it much easier to draw warrants or checks addressed to these different financial agents or tax collectors and thus to happily honor the requisitions made upon him by his colleagues of the Ministries of War, Justice, Public Instruction, Interior, and Foreign Affairs, than ever have any dealings with vulgar cash … Central Government knows nothing as to the sources of the revenue which it is supposed to receive. Its sole connecting link with the taxpayers of the province of Azerbaijan is through the chief collector at Tabriz. The latter official, in turn, knows how much money and produce should be furnished by each of the sub-collectors under him within the province, but he has no official knowledge of the sources from which these sub-collectors derive the taxes, which they deliver to him. The chief collector has in his possession what is termed the kitabche [little book] of the province, and each of the sub-collectors has the kitabcha of his particular district. These little books are written in a peculiar Persian style, on very small pieces of paper, unbound, and are usually carried in the pocket, or at least kept in the personal possession of the tax-collector.” (See Shuster M (1912) The Strangling of Persia. The Century Co, p. 41–42, 280–281).
- 32.
IBP Inc., Iran Mining Laws and Regulations Handbook, Volume 1 Strategic Information and Basic Laws. Lulu.com, p. 217. Some scholars, however, offered the opposite observation. For instance, Mehrzad Boroujerdi has stated “Riza Shah’s regime benefited from oil revenues that increased more than sixfold from £600,000 in 1921 to £4 million in 1940.” (See Boroujerdi M (2005) Triumphs and Travails of Authoritarian Modernisation in Iran. In: Cronin S (ed) The Making of Modern Iran: State and Society under Reza Shah, 1921–1941. Taylor & Francis e-Library, p. 154). However, no references were cited to validate the source of observation. Moreover, even if he’s correct in his observation, the fact is, “Iran originally received only a small share of its oil wealth, as the royalties paid to the government of Iran by the British holder of the oil concession amounted to barely 8% of the value of the oil exports. After the concession had been renegotiated by Reza Shah’s government in the early 1930s [in which the Iranian government defied the British by canceling the concession for the Anglo-Iranian (formerly Persian) Oil Company], Iran’s share rose to about 15%.” (See Jos Raadschelders and Eran Vigoda-Gado, Global Dimensions of Public Administration and Governance: A Comparative Voyage, John Wiley & Son, 2015, p. 287).
- 33.
Haas WS (1946) Iran. Columbia University Press, p. 157
- 34.
According to Islamic Revolution Document Center in Iran, “Although observed as an unwritten law towards European merchants and nationals since the Safavid dynasty, Capitulation was enforced as a law subsequent to Russo-Iran Wars during Qajars. It was first imposed on Iran by Tsarist Russia in 1828 according to the Treaty of Turkmenchay. Thereafter, England and other European countries enjoyed the same rights in Iran. Chapters 7–9 of the Treaty of Turkmenchay, which dealt with legal and criminal issues of Russian nationals in Iran were its main content; with enforcement of these chapters, capitulation regime was established in favor of the Russians. Although in 1921, a day prior to the coup conducted by Seyyed Zia, the Soviet Russia unilaterally cancelled capitulation as a Tsarist colonial institution, the capitulation treaty concluded with Tsars was valid for 99 years and Reza Khan’s decree on revocation of it (1927) was issued right at the end of treaty period.” (http://www.irdc.ir/en/content/24457/print.aspx).
- 35.
Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 137
- 36.
As Abrahamian noted, “Reza Khan’s path to the throne, in short, was paved not simply by violence, armed force, terror, and military conspiracies, but by open alliances with diverse groups inside and outside the Fourth and Fifth National Assemblies. These groups were formed from four political parties: the conservatives of the misnamed Reformers’ party (Hizb-i Eslah Taleban); the reformers of the Revival party (Hizb-i Tajadod); the radicals of the Socialist party (Hizbi Sosiyalist); and the revolutionaries of the Communist party.” (See Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 102).
- 37.
Those few scholars who were attentive enough to note this transfer of the right failed to see the significance of such right for the country. For instance, while Ervan Abrahamian mentioned, “The National Bank took over the British Imperial Bank the right to print money,” in the following sentence, he astonishingly offered a most peculiar observation: “This came in handy when paper money helped finance industrialization in the late 1930s. This fueled a 54 percent rise in basic prices.” (See Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 102). Now, of all miserable social, political, and economic conditions such as wide spread civil unrests, the dire consequences of famine of 1917–1919, foreign occupation, disintegration of the central government, state’s financial bankruptcy, blotting foreign debt, etc., Abrahamian pulled out “money supply” out of a hat as the cause of inflation. More significantly, the precision of the percent rise in basic prices, with no references cited, is bewildering. Unless, the author estimated the inflation rate based on either cross-sectional or time series data. On this account, and to the best of my knowledge, neither Iranian government publication nor any international agencies offered such database about inflation in Iran as far back as 1930s. Yet, more puzzling is the fact that the author not only ignored the tremendous advantage of the transfer of the right to the nation, but in one sentence, he turns significant benefits into extreme disadvantage. In another way, it could have been better if the right to print money was remained with the Imperial Bank! Finally, and from purely conceptual term, if printed money, as Abrahamian claimed, used to finance industrialization in that printed money directly linked to production, the result would be “monetization of output” in word of Alvaro Cencini, which is not inflationary. (See Cencini A (1995) Monetary Theory: National and International. Rutledge, p. 21.) I would suggest to all those who subscribed to the universal notion that inflation is a monetary phenomena to read Cencini’s book, particularly the Chaps. 1 and 2.
- 38.
As Kindleberger and Shonfield stated, “If the dollar is a world money, the United States is a bank and not a firm as other countries are. The difference between a firm and a bank, of course, is that the liabilities of the former are expected to be paid off at regular intervals, while those of the latter are passed from hand to hand as money, and tend to be permanent in fact, despite being of ‘demand’ in form. To the extent that a country is a bank and not a firm, its balance of payments must be viewed from a different perspective, with equilibrium, deficits and surplus measured on a different basis.” (See Cencini A (1995) Monetary Theory: National and International. Rutledge, p. 21).
- 39.
Similarly, during the disintegration of the former Soviet Union, one of the major sticking points of negotiation between those regions who sought independence and Russia was the right to print a national currency in each state. (See Brzezinski Z, Sullivan P (1997) Russia and the Commonwealth of Independent States: Documents, Data, and Analysis. M. E. Sharp).
- 40.
Dobeck MF, Elliott E (2007) Money. Greenwood Publishing Group, p. 67. In addition, Dorothee Bohle and Béla Greskovits have observed that the single most important policy choice in respect to economic transition [in Baltic states] was the rapid introduction of a national currency as a foundation for economic independence, powerful symbols of national identity and sovereignty, and the related institutionalization of the independent central bank. (See Bohle D, Greskovits B (2012) Capitalist Diversity on Europe’s Periphery. Cornell University Press, p. 104.) In our own history, this observation can also be confirmed. As C. E. Bosworth noted, “The coins of the Tahirids are little different from those of other ‘Abbasid governors [indicates that they were not independent of their Caliphate].” (See Bosworth CE (2008) The Thahirids and Saffarids. In: Frye RN (ed) The Cambridge History of Iran, Vol. 4. The Period from the Arab Invasion to the Saljuqs. Cambridge University Press, p. 103). However, the Saffarid reign opposed Caliphate and fought for their independence, and hence they minded their own silver coins, as an indication of their autonomy from Caliphate in Bagdad.
- 41.
Cencini A (1995) Monetary Theory: National and International. Rutledge, p. 249.
- 42.
The issue of illiteracy has been noted as the major predicament in development since the Constitution of 1907. For instance, the delegates to the first Majlis made broad provision for education, to which article 18 of the Constitution states, “The acquisition and study of all sciences, arts and crafts is free, except in the case of that which is forbidden by ecclesistical (Shariat) law.” The following article declared, “The foundation of schools at the expense of the government and the nation, and compulsory instruction, must be regulated by the Ministry of Sciences and Arts, and all schools and colleges must be under the supreme control and supervision of that Ministry.” Various governments in the post-constitutional era still failed to concur and meet its obligations until the Reza Shah reign.
- 43.
Two books that stirred controversies on the latter point, and in Kasravi’s words caused “the Iranian awakening,” were Talebof’s The Book of Ahmad and Zayn ol-Abedin Marraghe’s The Travel Diary of Ebrahim Beg. The variety of topics in The Book of Ahmad, for instance, reflected the lively curiosity of Talebof’s young imaginary son. Similar to Rousseau in his Emile, Talebof explained how he undertook to educate a seven-year-old child. Among other things, he asked his father about prayer; how pencils, paper, and ink were made; the construction of the pyramids in Egypt; growing of tea; bees and their organization; and the geographical location of Washington, D.C., Japan, and other places, all of which are ample indications of natural inquisitiveness that was absent in traditional education in Iran. (See Arasteh AR (1962) Education and Social Awakening in Iran, 1850–1968. Leiden E. J. Brill, p. 50. See also Kasravi A (2006) History of Iranian Constitutional Revolution (Tarikh-e Mashrute-ye Iran). Trans: Evan Siegal. Mazda Publisher, p. 54–56).
- 44.
For instance, in the port of Bushire, around 1925, Mirza Ahmad Kazeruni, with help from local merchants, established Madresseh Ferdowsi. The school’s curriculum also included football (American soccer) and hockey (See Iran Shahr [an educational journal] Tehran 11, p. 675). In the City of Isfahan, about 1923, the philanthropist Mokhtari set up two elementary schools, one for boys and the other for girls. The pupils received clothing and school supplies. The same benefactor established a boarding elementary school, organized social clubs for adults, and introduced adult education.
- 45.
Another example of an inclination for uniformity in Reza Shah reign is the dress code for men. As Ali Ansari noted, the concern for uniformity for the Shah seems to have been motivated by the appearance of civility as well as appeal of military discipline. An example of the latter is “the engagement of drill for students, the development scouting, and a regimen of public physical exercise.” (See Ansari AM (2012) The politics of nationalism in modern Iran. Cambridge University Press, Cambridge, p. 84.)
- 46.
For a comprehensive study of the role of the government in national education around the world in the twentieth century, see Cubberley EP, Elliott EC (1915) State and Country School Administration. Macmillan, particularly Chap. 1, “Education as a state Function.” For a critical review of the topic, see Mulhern J (1959) A history of education: a social interpretation. Ronald Press Co.
- 47.
Arasteh AR (1962) Education and Social Awakening in Iran, 1850–1968. Leiden E. J. Brill, p. 55
- 48.
See Haas WS (1946) Iran. Columbia University Press, New York, p. 146.
- 49.
Schooling constitutes an institution in the same sense as the corporation, the government, and the mosque. The structure of the school institution is age/grade and subject/discipline based. There are differences between institutions within each of the divisions (i.e., elementary, high school), but the differences between the divisions are much larger, for example, whether, a high school is public, private, rural, urban, etc.
- 50.
I, therefore, reject the notion that the new school system in the Reza Shah era was designed primarily to provide the regime with trained labor. While I have no dispute with the merit of argument, one must take into consideration the overall existing conditions of the country and circumstances under which the reform took place. Moreover, I do not know of any education reform anywhere in the world that attained a multitude of objectives under the similar political and economic state of the country, embedded cultural qualities that go back millennia, and were totally alien to the notion of schooling/education and a time interval that did not exceeded 15 years.
- 51.
This is mostly related to the mindset that still exists today, which endorses the false myth that instructional accomplishments are the focus of education. As a matter of fact, these standardized instructions should be viewed as the weakest societal service the institution provides. What they mainly lack is the objective of education, that is, learning, or, for a better phrase, learning through questioning. This “glitch” is naturally impinging on the “accountability” and “responsibility” of those who attend school institutions, who should first be regarded as citizens and then as future labor. Citizenry is the necessary obligation that must be taught; labor is a category that must be filled. Marshall McLuhan’s aphorism, “The medium is the message” perhaps sums up the essence of the glitch. That is, the medium (schooling) transformed how the message (learning) is perceived. To endorse schooling instead of education is to perpetuate an artificial conformity and ruin our life without ever knowing why.
- 52.
Matthee R (2005) Transforming dangerous Nomads into Useful Artisans, Technicians, Agriculturalists: Education in the Reza Shah period: In: Cronin S (ed) The making of modern Iran: State and society under Riza Shah, 1921–1941. Taylor & Francis e-library, p. 145
- 53.
Chatelet A (1936) La mission Lazariste en Perse. Revue d’Histoire des Missions. 13E Annee 4, December 1936, p. 501. See also Matthee R (2005) Transforming dangerous Nomads into Useful Artisans, Technicians, Agriculturalists: Education in the Reza Shah period: In: Cronin S (ed) The making of modern Iran: State and society under Riza Shah, 1921–1941. Taylor & Francis e-library, p. 134.
- 54.
Matthee R (2005) Transforming dangerous Nomads into Useful Artisans, Technicians, Agriculturalists: Education in the Reza Shah period: In: Cronin S (ed) The making of modern Iran: State and society under Riza Shah, 1921–1941. Taylor & Francis e-library, p. 146.
- 55.
Arasteh AR (1962) Education and Social Awakening in Iran, 1850–1968. Leiden E. J. Brill, p. 57.
- 56.
It should be noted that, because the notion of nationalism is not a total ideology, it often manifests by a variety of ideological flags in Iran. For instance, liberal-nationalism originated in the works of Mirza Malkom Khan and Hassan Taqizadeh; Persian-nationalism traced back to thinking of people like Aga Khan Kermani, Mirza Fatali Akhundzadeh, and Zain al-Abedin-e Maraghehi; Islamic (and Pan-Islamic) nationalism associated with Jamal al-Din Assad-Abadi and Sayyed Hassan Modarres; and Socialist-nationalism begun by activists such as Talebov, Haydar Amu-Oghli, and Ali-Akbar Dehkhoda. (See Farsoun SK, Mashayekhi M (eds) (2005) Iran: political culture in the Islamic Republic. Routledge, London, p. 58–59).
- 57.
However, there is a great difference in the manner in which each country established it. From the secular state building in the late nineteenth century to the present, assertive secularism in France has coexisted with multiparty democracy and has gained substantial popular support. In Turkey, by contrast, assertive secularism was established by an authoritarian single-party rule in the early twentieth century and had been vigorously defended until the 2000s when Islamist Justice and Development Party won the election and form the Islamic government. (See Kuru A, Stepan A (eds) (2012) Democracy, Islam, & Secularism in Turkey. Columbia University Press, p. 104.)
- 58.
As Mehrzad Boroujerdi informed us, “In his travelogues to Khuzistan and Mazandaran, written in 1924 and 1926, he reveals his respect for predecessors who sought to make Persia a stable and prosperous empire—Shah Isma‘il (r. 1501–1524), Shah Abbas (r. 1587–1629), Nader Shah (r. 1729–1747) and Karim Khan Zand (r. 1747–1779). Yet Riza Khan/Shah denounces the founder of the Safavid dynasty, Shah Isma‘il, for yielding too easily to Shi‘i groups and Shi‘ite sentiments. He criticizes another Safavid ruler, Shah Abbas, for the ‘unforgivable mistake’ of mixing politics with religion … Riza Shah’s strong preference for a secular system of government is clear: ‘There is no doubt that religion and politics are two holy principles whose precise details should be known and observed by all enlightened leaders. However, the mixing of these two is neither advantageous to religion nor to administrative politics because such a fusion weakens religion and leads to the decline of politics.” (See Boroujerdi M (2005) Triumphs and Travails of Authoritarian Modernisation in Iran. In: Cronin S (ed) The Making of Modern Iran: State and Society under Reza Shah, 1921–1941. Taylor & Francis e-Library, p. 153.)
- 59.
See Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 131.
- 60.
However, formalization of secularism is also problematic. As Mark Juergensmeyer noted, “much has been written about the religious fear of secularism, but relatively little about the sometimes irrational hatred some secularists harbor against the potency of Religion.” (See Juergensmeyer M (1995) Antifundamentalism. In: Marty ME, Appleby RS (eds) Fundamentalisms Comprehended. University of Chicago Press, p. 353). He cites a number of examples where “secular governments have taken abnormal liberties with the democratic process as a way of countering what they perceived to be fundamentalist threat” (Ibid., p. 354).
- 61.
See Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 132–133.
- 62.
The journal Iranshahr summed up the views of the parliamentary majority in an editorial on “Republicanism and Social Revolution”: “Today almost all of Europe, including Russia, has adopted the republican system of government. There is no doubt in our minds that in the modern age the republican form of government is the best system of government. However, while we have no doubts on the merits of republicanism, we must admit that republicanism is not an end in itself but only a means to a higher end, that of destroying royal and clerical despotism in order to lead the masses toward a social revolution. You will understand the need for such a revolution if you look at the minority party in the Majles. These clerical deputies have been elected by exploiting public ignorance, fears, backwardness, and superstition. It is high time we eliminated the power of the monarchy. Once we have done so, we can turn our attention to the more reactionary power of the parasitical clergy” (Ibid., p. 133).
- 63.
According to Abrahamian, the gathered protestors demanded: “We want to keep the religion of our fathers, we don’t want a republic. We are the people of the Koran, we don’t want a republic.” (See Ibid., p. 134.)
- 64.
Ibid., p. 135.
- 65.
According to Ali Ansari, “Mosaddeq above all objected to the concentration of power in the hands of a single individual, noting that in elevating Reza Khan to the throne, the Majlis was effectively combining the office of monarch with that of Prime Minister, and importantly confusing the Constitutional responsibility of ministers with that of the Shah, who by law was not meant to interfere in politics.” (See Ansari AM (2012) The Politics of Nationalism in Modern Iran. Cambridge University Press, p. 81.) Ansari further stated, “The noted cleric Mudarris absented himself from the debate because he considered the entire discussion illegal … One notable vote against the change in dynasty came from Hasan Taqizadeh, who argued against the vote on procedural grounds. This would after all be a Constitutional change, and the Constitution as granted had invested the crown in the Qajar family. It was not for the Majlis to single-handedly deliver such a significant change to the Constitution. Taqizadeh argued that for future stability and legitimacy it would better if a special Constitutional Commission were established to study the matter and make recommendations” (Ibid., pp. 81–82).
- 66.
At the time, the most logical candidate for kingship who saved the monarchy was perhaps Mohammad Mossadegh, whose attitude to religious authorities was as pragmatic as his attitude toward Islam. More importantly, he also had a firm position within the Iranian traditional oligarchy and blood tie with the Qajar dynasty. Decades later, however, Mossadegh changed his position. Understanding the power of the pragmatic populism that had made the whole constitutional experiment worthwhile, he addressed the Parliament on April 12, 1952, in which he claimed: “Among my professors in Switzerland there was one, who, from the standpoint of education, had divided the nations of the world into three groups: learned, ignorant, and mediocre nations. He applied the term learned to a nation that is capable of discerning good from bad, and has the will-power to carry out its discernments, ignorant to a nation easily misguided by individuals or other nations, and, finally, mediocre to a nation who possesses the ability to discern but lacks the will-power to carry it out. At the beginning of the establishment of Constitutionalism, a few well-wishing people guided the nation in the direction they believed to be to their benefit; as a result, despotism was abolished and a constitutional regime was adopted. During the term of the third parliament, when after graduation I return from Switzerland, I found a good example for the professor’s hypothesis; the people were neither wanting in discernment (so as to be guided by others) nor were they powerful in will so as to carry out their discernment. However, before the election for the 16th parliament began, it become obvious, when I called my dear fellow countrymen to submit a supplication to the Imperial Court, that the people possess an excellent ability to discern. From these premises I wish to infer that you are elected by a people who can discern good from bad, and that you represent a nation whose acumen no one can challenge. Accordingly, you can see the difficulties and can easily procure means to remove them” (Mottahedeh R (1985) The mantle of the prophet: religion and politics in Iran. Simon & Schuster, New York, p. 129.)
- 67.
Abrahamian E (1982) Iran Between Two Revolutions. Princeton University Press, p. 135.
- 68.
It is certainly true that a great deal of governing of the country and of political influence were wielded by a few families, while many more who have some wealth and notoriety were treated with great deference. (See Binder L (1962) Iran: political development in a changing society. University of California Press, Los Angeles, p. 66).
- 69.
For illuminating discussions on the difference between despotism and the rule of law, see Kriegel B (1995) The State and the Rule of Law. Trans: Lepain MA, Cohen JC. Princeton University Press. Kriegel argues that the most essential advantage of liberty is refusing to distinguish between the notion of despotism and the concept of lawful state.
- 70.
Anidjar G (2006) Secularism. Critical Inquiry 33, Autumn 2006, p. 62–63. Italic origin. This observation is a radical divergence from the older generation of theorists who delineated secularism as a product of modernity. For instance, Hannah Arendt thought, “what was at stake in modernity was leaving religion behind, at least as the foundation of public coexistence.” (See Moyn S (2008) Hannah Arendt on the Secular. New German Critique 105, fall 2008, p. 71.) And yet, a new perspective put forward by a new group of theorists, such as Asad T (1993) Genealogies of Religion: Discipline and Reasons of Power in Islam and Christianity. John Hopkins University Press, Asad T (2003) Formations of the Secular: Christianity, Islam, Modernity. Stanford University Press, and Taylor C (2007) A Secular Age. Harvard University Press, has come to see secularism as a special discourse of Christianity (particularly Protestantism). Their main argument, to which this study also subscribed, is that Western Christianity and the Enlightenment produced a set of binary oppositions between the religious and the secular, Church and state, which then attempted to impose things globally, producing “religions” at the colonial periphery where it encountered resistance. Looked at one way, Christianity produced its own existing form in the political order and then tried to take the rest of the world with it. Looked at another way, the project of modernity embodied in the nation-state resulted in the construction of “religion” as a marked category from which the “secular” appeared to be the neutral or unmarked background. This process was founded on a contradiction, because even while the churches were losing power (unlike Iran), certain Christian theological concepts and symbols were still being embedded in the state but in a new configuration. Hence, the categories “secular” and “religious” are fundamentally entangled: secularization is religious in several registers and the construction of religions can be seen as secularizing. (See Josephson JA (2012) The Invention of Religion in Japan. University of Chicago Press, p. 135). For informative discussions of this and similar topics, see Mason E (2015) Reading the Abrahamic Faiths: Rethinking Religion and Literature. Bloomsbury Academic.
- 71.
As F. W. Maitland observed, “Men would never have become enthusiastic students of other books … the men who first reaches the Digest [The Digest, also known as the Pandects, is a name given to a compendium or digest of Roman law compiled by order of the emperor Justinian I in the 6th century] is the man who first teaches what the modern world has meant by Roman law … it was only in the Digest that men could get any notion of keen and exact legal argument, precise definition etc.” (See Stein P (1999) Roman Law in European History. Cambridge University Press, p. 44).
- 72.
Ibid., p. 30
- 73.
In fact, the Roman emperor Constantine, the son of Constantius and Helena, is a well-known hero of Christianity, who claimed to see visions from God, in which he heard (or saw) in hoc signo vince (In this sign you will conquer), which results in Constantine ordering his commanders to put on their shields the Greek letter chi and rho (the first two letters in the Greek name for Christ).
- 74.
The original message, coming in response to a question of whether it was lawful for Jews to pay taxes to Caesar, gives rise to multiple possible interpretations about the circumstances under which it is desirable for the Christian to submit to earthly authority (see https://en.wikipedia.org/wiki/Render_unto_Caesar).
- 75.
However, as John Turner has noted, “Islamic International Relations is non-Western discourse containing a concept of sovereignty not necessarily amenable to orthodox International Relations theory and Western concepts of the nation state.” (See Turner J (2012) Uncovering an Islamic paradigm of International Relation. In: Flood C, Hutchings S, Miazhevich G, Nickels H (eds) Political and Cultural Representations of Muslim: Islam in the Plural, Brill, p. 16.)
- 76.
Calhoun C, Juergensmeyer M, VanAntwerpen J (2011) Rethinking Secularism. Oxford University Press, p. 3.
- 77.
Hobsbawm E (1997) On History. The New Press, p. 254.
- 78.
Daniel EL (2012) The History of Iran. ABC-CLIO, p. 140
- 79.
See Cottam RW (1979) Nationalism in Iran. University of Pittsburgh Press, pp. 59–62.
- 80.
Cyrus Schayegh claimed, “Iran’s first two electric power plants were erected in 1900 and 1902 in the northeastern city of Mashhad to illuminate the famous shrine of Emam Reza.” He further stated, “In Tehran, the first (300 kW German imported) plant was constructed by the merchant Mohammad Hossein Amin al-Zarb.” (See Schayegh C (2009) Who is Knowledgeable Is Strong: Science, Class, and the Formation of Modern Iranian Society, 1900–1950. University of California Press, p. 253). According to Mohammad Hejazi, however, the first time the whole of Tehran was covered dated back to 1954 (1333/7/3), when the Tehran municipality purchased four electric turbines 1(600 kW each) for 91,890 British pounds on an installment plan. (Hejazi M (1959) Mehan Ma (Our Country). Ministry of Culture Publication, Tehran, 1959 (1338), p. 617).
- 81.
Hejazi M (1959) Mehan Ma (Our Country). Ministry of Culture Publication, Tehran, 1959 (1338), p. 624.
- 82.
According to Amin Banani, “On June 1, 1941, a milestone was reached in the government’s efforts to promote public health when the Majlis approved a law for the prevention and combating of infectious diseases. This law made the treatment of venereal diseases compulsory; made free medication available for needy patients; made willful, knowing, or negligent transfer of such diseases, as well as fraudulent promises of a cure, subject to punishment; and provided for periodic inspection and certification of brothels. It also required compulsory vaccination against smallpox at the ages of 2 months, and 7, 13, and 21 years, as well as additional vaccination in times of epidemic.” (See Banani A (1961) The Modernization of Iran, 1921–1942. Stanford University Press, p. 65). It should be noted that the organization of public health services in Iran dates back to the time of Reza Shah .
- 83.
“During the period 1960–1976, Iran enjoyed one of the fastest growth rates in the world: the economy grew at an average rate of 9.8 percent in real terms, and real per capita income grew by 7 percent on average. As a result, GDP at constant prices was almost 5 times higher in 1976 than in 1960. This stellar performance took place in an environment of relative domestic political stability, low inflation, and improved terms of trade, as evidenced by the rising oil price relative to import prices. Both oil output and oil prices increased significantly during the period: oil production grew at an annual average rate of 10 percent while oil prices relative to import prices increased by 214 percent during the sub-period”. (See Jbili A, Kramarenko V, Bailén J (2004). Islamic Republic of Iran-Selected Issues. IMF Country Report 04/308. International Monetary Fund, p. 7). In a detailed analytical article by Hadi Salehi-Esfahani and Hashem Pesaran (Salehi-Esfahani H, Pesaran H (2009) The Iranian Economy in the Twentieth Century: A Global Perspective. Iranian Studies 42(2) 2009, pp. 177–211), the authors also make the point that the only period of sustained and stable economic growth in Iran’s twentieth century history was between the early 1960s and the mid-1970s—true enough. Furthermore, they state that Iran was catching up with the wealthy Western states by the 1970s. The authors rightly assume that the goal of “development,” as it was argued in the 1950s and afterwards, meant “catching up” to the First World/North, and not simply increasing the absolute size of the economy. Wealth (or its numerical proxy, Gross Domestic Product) is understood and shown as a relative measure. Using per capita GDP figures adjusted for purchasing power parity, the authors note that at the end of this rapid period of growth in 1976, “per capita income in Iran had reached about 64 percent of the average for 12 Western European countries.” (For a critical review of the paper, see http://kevanharris.princeton.edu/blog/2013/03/did-iran-lose-its-chance-catching-west).
- 84.
Summer WG (1906) Folkways: A Study of the Sociological Importance of Usage, Manners, Customs Mores, and Morals. The New American Library, p. 44.
- 85.
See Wright Mills C (2008) The Politics of Truth Selected Writings of C. Wright Mills. Oxford University Press, pp. 127–128.
- 86.
Here, the notion of action is not what we, Iranians, usually perceived it to be in that it satisfies a need for revenge, gratification, devotion, contemplative bliss, or for working off emotional tensions, but rather “the action of persons who, regardless of possible cost to themselves, act to put into practice their conviction of what seems to them to be required by duty, honor, the pursuit of beauty, a religious call, personal loyalty, or the importance of some “cause” no matter what it consists”. (see Weber M (1978) Economy and Society: An outline of Interpretive Sociology. University of California Press, p. 25).
- 87.
Skinner Q (2004) Liberty Before Liberalism. Cambridge University Press, pp. 7–8.
- 88.
This happened despite the fact that at the time and among all fields of science, Newtonian physics was perceived more firm, coherent, and methodologically certain to the extent that only a fool would dare to claim that flight by birds or butterflies negated the laws of gravity. Perhaps that is why Einstein rejected Heisenberg’s interpretation and wrote: “I, at any rate, am convinced that He [God] does not throw dice.” I supposed Einstein meant that the world did not get here accidentally, which is precisely what all monolithic scriptures teach. The world must have a structure, and that structure is harmonious, and it is harmonious because God created it.
- 89.
It should be noted that Mosaddeq was the first Iranian to advocate the abolition of capitulations, in a widely circulated pamphlet in 1914 (Mosaddeq M (2003) Kapitolasion va Iran (November 1914). In: Afshar I (ed) Mosaddeq va masa’el-e hoquq va siasat. Tehran, 39–78).
- 90.
It is astonishing, given the history of economic malaise, that Abolhassan Ebtehaj was the only leading economic policymakers who resigned from his post as head of Planning Organization in 1959. In his obituary, the British Newspaper The Independent wrote, “In resisting political interference and the diversion of oil revenues to the military he made enemies once again and lost the all-important support of the Shah … In November 1961 Ebtehaj was arrested on trumped-up charges of acting illegally in signing a contract while head of the Plan Organisation with a well-known American firm of consultants. He spent seven months in prison before adverse publicity in the United States and the UK caused the Shah to order his release without trial. Before this he had … . founded his own Iranians Bank … . In 1974 Ebtehaj established as a joint venture with a leading American insurance company the Iran-America International Insurance Co. Both institutions prospered. In 1977, in what proved to be a very lucky decision, Ebtehaj sold out his interest in the bank very profitably.” (See http://www.independent.co.uk/arts-entertainment/obituary-abolhassan-ebtehaj-1079753.html).
- 91.
Gerschenkron A (1962) Economic Backwardness in Historical Perspective: A Book of Essays. Fredrick A. Praeger Publishers, p. 5.
- 92.
Toynbee AJ (1947) A Study of History: Abridgement of Volumes I to VI. Oxford University Press, p. 161 and 273.
- 93.
Polanyi K (1957) The Economy as Instituted Process. In: Polanyi K, Arensberg CM, Pearson HW (eds) Trade and Market in Early Empires: Economies in History and Theory. The Falcon’s Wing Press, p. 243.
- 94.
Herskovits MJ (1952) Economic Anthropology: A Study in Comparative Economics. Alfred A. Knopf, p. 294.
- 95.
Dalton G (1961) Economic Theory and Primitive Society. American Anthropologist 63(1), p. 6.
- 96.
See Lazonick W (1991) Business organization and the myth of the market economy. Cambridge University Press, p. 16.
- 97.
Marshall A (1990) Principle of Economics: An introductory volume, eighth edition. Porcupine Press, p. 12.
- 98.
George Dalton underlined three aspects of such economy: (1) it has no necessary connection with the substantive meaning of economic; (2) economizing calculation by no means need be confined to the creation, distribution, or use of material goods; and (3) a primary field of Western economic analysis, price and distribution theory, is an application of the formal meaning of economic. (See Dalton G (1961) Economic Theory and Primitive Society. American Anthropologist 63(1), p. 7).
- 99.
For more detail see Dalton G (1961) Economic Theory and Primitive Society. American Anthropologist 63(1), p. 7.
- 100.
Polanyi K (1957) The Economy as Instituted Process. In: Polanyi K, Arensberg CM, Pearson HW (eds) Trade and Market in Early Empires: Economies in History and Theory. The Falcon’s Wing Press, p. 243.
- 101.
Dalton G (1961) Economic Theory and Primitive Society. American Anthropologist 63(1), p. 6.
- 102.
See Appendix on Economic of Development.
- 103.
Godelier M (1972) Rationality and Irrationality in Economics. Trans: Brian Pearce. Monthly Review Press, p. 258.
- 104.
In their most primitive forms, both notions refer to combinations of objects in accordance with rules.
- 105.
Here, objects can take on various real forms. In certain content, for instance, this proposition implies that it is possible to think of polity as capable of setting the goal-states of the social system (see Parsons T, Smelser NJ (2001) Economy and Society: A Study of Economic and Social Theory, Routledge, pp. 48–50). This goal-setting process is conceived in terms of objects capable of “realization,” “gratification,” and “recognition” of the societal will, and hence is not limited to any specific formal organization such as political parties, government cabinet offices, etc. In short, polity is a system limited to goal-setting according to rules that are created by the structure in which it operates.
- 106.
Godelier M (1972) Rationality and Irrationality in Economics. Trans: Brian Pearce. Monthly Review Press, p. 258.
- 107.
A crude example is today’s global economic system, where energy is treated as a commodity that benefits energy-producing enterprises (according to already established rules of Commodification), while in another type of an economic system, energy may be treated as a social necessity that benefits those who lack purchasing power.
- 108.
Lazonick W (1991) Business organization and the myth of the market economy. Cambridge University Press, p. 59.
- 109.
Smith’s arguments for laissez-faire had to do with eradicating legislated barriers to the mobility of capital into those uses in which its owners deemed it most profitable to employ—that is, into those uses that offered the most scope for specialized divisions of labor. If the barriers to entry into productive activity and product markets were broken down, Smith argued, the invisible hand of self-interest would guide capital into those uses in which the division of labor could be carried the furthest. (For an informative and detailed analysis of the topic, see Lazonick W (1991) Business organization and the myth of the market economy. Cambridge University Press, Chap. 8.)
- 110.
So when, for instance, Viet Nam embarked in transition to a market-oriented economic system, the government’s first task was primary focused on reform of land property in which private properties and property rights are protected by the state. (See Barker R (ed) (1994) Agricultural Policy Analysis for Transition to a Market-Oriented Economy in Viet Nam: Selected Issues. Economic and Social Development Paper 123. Food & Agriculture Organization, pp. 8–10).
- 111.
Lawrence BS (1984) Historical Perspective: Using the Past to Study the Present. The Academy of Management Review 9(2), p. 307.
- 112.
Prior to the modern market economy, there was no economic principle. As Moses Finely in The Ancient Economy explains, “[Alfred] Marshall’s title [The Principles of Economics] cannot be translated into Greek or Latin. Neither can the basic terms, such as labour, production, capital, investment, income, circulation, demand, entrepreneur, utility, at least not in the abstract form required for economic analysis. In stressing this I am suggesting not that the ancients were like Moliere’s M. Jourdain, who spoke prose without knowing it, but that they in fact lacked the concept of an ‘economy’ and, a fortiori, that they lacked the conceptual elements which together constitute what we call ‘the economy.’ Of course they farmed, traded, manufactured, mined, taxed, coined, deposited and loaned money, made profits or failed in their enterprises. And they discussed these activities in their talk and their writing. What they did not do, however, was to combine these particular activities conceptually into a unit, in Parsonian terms [Talcott Parsons’ term] into a ‘differentiated sub-system of society.’ Hence Aristotle, whose programme was to codify the branches of knowledge, wrote no Economics. Hence, too, the perennial complaints about the paucity and mediocrity of ancient ‘economic’ writing rest on a fundamental misconception of what these writings were about.” (Finely MI (1999) The Ancient Economy. University of California Press, p. 21).
- 113.
Marx K (1976) Capital: A Critique of Political Economy, Volume I. Penguin Books, p. 711.
- 114.
Braudel F (1982) The Wheels of Commerce: Civilization and Capitalism 15th-18th Century, Volume II. Trans: Sian Reynolds. Harper & Row, p. 25.
- 115.
See Marx K (1976) Capital: A Critique of Political Economy, Volume I. Penguin Books, Chap. 6-The Sale and Purchase of Labour-Power.
- 116.
Kirzner IM (1963) Market Theory and the Price System. Princeton, p. 2. Emphasis added.
- 117.
Robinson J (1965) Consumer’s sovereignty in a Planned Economy. On Political Economy and Econometrics, Essay in Honour of Oskar Lange. Polish Scientific Publishers, p. 521.
- 118.
Kirzner IM (1963) Market Theory and the Price System. Princeton, p. 3. Emphasis origin.
- 119.
In this light, Daniel Bell in Cultural Contradictions of Capitalism points out, “It is important to realize that the market economy, though it is associated historically with the rise of modern private capitalism, is as a mechanism not necessarily limited to that system. Such writers as Enrico Barone and, later, Oskar Lange argued that a socialist market economy was entirely possible, and that the market would operate more efficiently under socialism than under modern capitalism, where its operations were consistently distorted by monopoly or oligopoly.” (See Bell D (2008) The cultural contradictions of capitalism. Basic Books, p. 223).
- 120.
Hass GC (1922) Sale Prices as a Basis for Farm Land Appraisal, Technical Bulletin 9. University of Minnesota Agriculture Experiment Station, p. 4.
- 121.
Relevant to this observation, is a distinction between needs and wants which must be clarify here. Needs are what is sustaining us as members of the “species” e.g., clean water, nutritious food intake, shelter, etc. Wants are wide ranging desires of individuals in accordance with their own preferences and idiosyncrasies. In the market system, needs are excluded and wants take on further modification in respect of what individuals can pay for (afford). In general, there is an established economic view to belittle the notion of needs in conventional economics on the ground of its ambiguity, as Keynes once wrote: “it is true that the needs of human beings may seem to be insatiable. But they fall into two classes—those needs which are absolute in the sense that we feel them whatever the situation of our fellow human beings may be, and those which are relative in the sense that we feel them only if their satisfaction lifts us above, makes us feel superior to, our fellows. Needs of the second class, those which satisfy the desire for superiority, may indeed be insatiable; for the higher the general level, the higher still are they. But this is not so true of the absolute needs” (Keynes JM (1963) Essays in Persuasion (No. 190). WW Norton & Company, p. 365).
- 122.
Becker G (1976) The Economic Approach to Human Behavior. University of Chicago Press, p. 14.
- 123.
To quote Oskar Morgenstern when he considered the meaning of competition, “the common sense meaning is one of struggle with others, of fight, of attempting to get ahead, or at least to hold one’s place. It suffices to consult any dictionary of any language to find that it describes rivalry, fight, struggle, etc. Why this word should be used in economic theory in a way that contradicts ordinary language is difficult to see. No reasonable case can be made for this absurd usage which may confuse and must repel any intelligent novice. In current equilibrium theory, there is nothing of this true kind of competition: there are only individuals, firms or consumers, facing given prices, fixed conditions, each firm or consumer for convenience insignificantly small and having no influence whatsoever upon the existing conditions of the market (rather mysteriously formed by tatonnemont (cf. point 4 below) and therefore solely concerned with maximizing sure utility or profit, the latter then being exactly zero. The contrast with reality is striking; the time has come for economic theory to turn around and to “face the music”.” (see Morgenstern O (1972) Thirteen Critical Points in Contemporary Economic Theory: An Interpretation. Journal of Economic Literature 10(4): 1163–1189, p. 1164).
- 124.
Robinson J (1980) What are the Question: And Other Essays. M. E. Sharpe, p. 7.
- 125.
Saint-Jean IT (2009) Is Homo economicus a ‘bad guy’?. In: Arena R, Dow S, Klaes M (eds) Open Economics: Economics in relation to other disciplines. Routledge, p. 262.
- 126.
Kirzner IM (2000) The Driving Force of The Market: Essay in Austrian Economics. Routledge, p. 256.
- 127.
Jevons WS (1866) Brief Account of a General Mathematical Theory of Political Economy. Journal of the Royal Statistical Society 29: 282–287. In the footnote of the paragraph Jevons noted Cournot defined the economical use of the word market: “On sait que les économistes entendent par marché, non pas un lieu déterminé ou se consomment les achats et les ventes, mais tout un territoire dont les parties sont unies par des rapports de libre commerce, en sorte que les prix s’y nivellent avec facilité et promptitude.” It is also noteworthy that Alfred Marshall in the Principle used the translation of exact quotation when he paraphrased Cournot and stated, “Economists understand by the term Markets, not any particular market place in which things are bought and sold, but the whole of any region in which buyers and sellers are in such free intercourse with one another that the prices of the same goods tend to equality easily and quickly.” (Marshall A (1990) Principle of Economics (eighth edition). Porcupine Press, p. 270).
- 128.
See Coase RH (1990) The Firm, The Market and The Law. University of Chicago Press, p. 7.; Stigler GJ (1987) The Theory of Price 4rd ed. University of Chicago Press; Stigler GJ (1972) Law and Economics of Public Policy: A Plea to the Scholars. The. J. Legal Stud. 1(1).
- 129.
Stigler GJ (1987) The Theory of Price 4rd ed. University of Chicago Press, p. 120.
- 130.
See Schroeder JL (2004) The Triumph of Venus: The Erotics of the Market, University of California Press, p. 112.
- 131.
In the real world, therefore, policies to contain cost are necessarily heterogeneous.
- 132.
For instance, some literature looks at the impact of transaction cost associated with bid reduction and zero quantity spread. Bid reduction represents a transaction cost that varies according to the size of the order. On the dealer market, the larger the order, the lower the bid will be, as the market maker is able to reduce the cost of trading per share, while still covering his costs. In this light, traders with larger trades favor the dealer market (see Vulkan N, Roth AE, Neeman Z (eds) (2013) The Handbook of Market Design. OUP Oxford, p. 631).
- 133.
According to this theory, if we cannot eliminate all imperfections, we cannot predict a priori whether the elimination of any one cost will have a positive or negative effect.
- 134.
Coase RH (1960) The Problem of Social Cost. The Journal of law and Economics, Vol. III, p. 43.
- 135.
Arrow KJ (1974) The Limits of Organization. Fels Lectures on Public Policy Analysis. W. W. Norton & Company, p. 48.
- 136.
Williamson OE (1999) The Mechanisms of Governance. Oxford University Press, p. 58.
- 137.
Keshavarzian A (2007) Bazaar and State in Iran: The Politics of the Tehran Marketplace. Cambridge University Press, p. 141.
- 138.
Hosseini SMR (2008) The Investigation of the Role of Institutions in the Process of Growth and Development of Economy. International Journal of Social, Behavioral, Educational, Economic, Business and Industrial Engineering 2(3): 159–161, p. 160.
- 139.
See Ashraf A (1988) Bazaar-Mosque Alliance: The Social Basis of Revolts and Revolutions. International Journal of Politics, Culture, and Society 1(4): 538–567, p. 564. See also Keshavarzian A (2007) Bazaar and State in Iran: The Politics of the Tehran Marketplace, Cambridge University Press, p. 111.
- 140.
Ibid., p. 216.
- 141.
Ibid., p. 17.
- 142.
Ibid.
- 143.
Mottahedeh R (1985) The Mantle of the Prophet: Religion and Politics in Iran. Pantheon, pp. 34–35.
- 144.
Ibid., p. 35. On bazaar shut down Mottahedeh offers the following, “Moments at which the Tehran bazaar closed punctuate the last two centuries of Iranian history.” (Ibid.). He underlined two example, one is during December of 1905 when many merchants and mullahs took sanctuary in protest to the manner in which the Tehran municipality treated the sugar merchants, which ultimately began the Constitutional Revolution. The second, and more relevant to this study, is in the summer of 1960 the government announced the results of elections to the parliament: “A completely honest election to the parliament was a fond dream, never yet experience by any generation of Iranians. But the election of 1960 were so blatantly rigged that even some of the winners were embarrassed, and an unusual season of limited freedom or expression allowed a few elder statesmen to say that the government had insulted the electorate. The bazaar closed. The elections were canceled.” (Ibid., pp. 35–36).
- 145.
Friedman M (1962) Capitalism and Freedom. University of Chicago Press.
- 146.
In fact, an advocate of both market-based economy and socialism found Knight exposition of economic organization (EO) beneficial. “Milton Friedman and George Stigler built their price theory books on the base set by Knight, Paul Samuelson borrowed from EO in creating his famous textbook, and both the essays by Fred Taylor and Oskar Lange in On the Economic Theory of Socialism adopted Knight’s statement of the operation of the price system in free enterprise as the basis for their advocacy of market socialism.” (Emmett RB (2010) Economic Organization, by Frank Knight: a reader’s guide. In: Emmett RB (ed) The Elgar Companion to the Chicago School of Economics. Edward Elgar, p. 56).
- 147.
Knight FH (1965) The Economic Organization. Harper & Row Publishers, p. 4.
- 148.
Ibid., pp. 4–5.
- 149.
Ibid., p. 6
- 150.
Ibid. It is noteworthy that deduction based on resemblance of the human body and an economic system is by no means an analytical novelty. The physiocrats of the eighteenth century were also making similar analogies between blood circulation and a circular flow of income throughout the economy. Francois Quesnay and his Tableau Economique (1759) are a good example of this trend.
- 151.
Ibid., p. 7.
- 152.
The last two are basically a group of functions that are responsible for maintaining and improving the social structure, promoting social progress, and adjustments to retain short-term equilibrium. They are: economic maintenance and progress; and to adjust consumption to production within a very short period.
- 153.
From a social point of view, Knight declared, “this process may be viewed under two aspects, (a) the assignment or allocation of available productive forces and materials among the various lines of industry, and (b) the effective coordination of the various means of production in each industry into such grouping as will produce the greatest result.” (Ibid., p. 8. Emphasis original).
- 154.
Ibid., p. 10. Emphasis original.
- 155.
Ibid., p. 10.
- 156.
The reader should note that the question of “for whom to produce” is related to income distribution; how to divide the national product? Jahangir Amuzegar underlined this point when he stated, “An aristocratic or a feudal society would naturally have a different distribution pattern than an egalitarian or a rural community. A developing country bent on rapid economic development would have a different distribution scheme to a developed, mature, affluent nation. The choice of alternative distribution patterns depends upon the nature of national objectives and social-welfare consideration.” (See Amuzegar J (1981) Comparative economics: national priorities, policies, and performance. Winthrop Publisher, pp. 15–16).
- 157.
Knight FH (1965) The Economic Organization. Harper & Row Publishers, p. 11. However, it should be noted that a portion of the remuneration (received income) is also composed of “unearned income”, irrespective of their contribution to the total output of the economy (social product), which is often undetected by orthodox analysts.
- 158.
It should be noted that unearned income is also called “property income” and refers to income received, not earned, by virtue of owning property. According to Phillip O’Hara, “Property income is, by definition, received by virtue of owning property. Rent is received from the ownership of land or natural resources; interest is received by virtue of owning financial assets; and profit is received from the ownership of production capital. Property income is not received in return for any productive activity performed by its recipients.” (See O’Hara P (2003) Encyclopedia of Political Economy, Volume 2. Routledge, p. 1135).
- 159.
Knight FH (1921) Risk, Uncertainty, and Profit. Houghton Mifflin Co, Boston, pp. 170–171. Emphasis added. This, however, is more or less an irrelevant issue within an income distribution scheme in other economic systems. For instance, a distributional principle of to each according to his contribution is considered to be one of the defining features of the socialism economic system. This is because, as Gregory and Stuart stated, “The state owns the means of production as well as rights to surplus value. Under socialism, each individual would be expected to contribute according to capability, and rewards would be distributed in proportion to that contribution. Subsequently, under communism, the basis of reward would be need. However, need would presumably have a meaning rather different from the one assigned to it under capitalism, where wants are continually expanding.” (See Gregory PR, Stuart RC (2004) Comparing economic systems in the twenty-first century. Houghton Mifflin, p. 119). The account that “in communism the basis of reward would be need” is a bit of a simplification that conceals the essence of this statement and the controversies that pursued it. The complete phrase is “From each according to his ability, to each according to his need” that was apparently used first by Louis Blanc, the French orthodox republican in the eighteenth century, who opposed Rousseau’s idea of a system of direct democracy on the ground that such an idea “could be only applied to societies characterized by ‘a very small state, a people that was easy to bring together, citizens who knew each other, a pronounced simplicity of morals, high levels of equality in both rank and fortune, little or no luxury’.” (See Jennings J (2011) Revolution and the republic: A history of political thought in France since the eighteenth century. Oxford University Press, p. 129). Blanc’s proposition was later adopted by Marx and used in Critique of the Gotha Programme, in which he declared “In a higher phase of communist society … [when] the narrow horizon of bourgeois right be fully left behind and society inscribe on its banners: from each according to his ability, to each according to his need!” (See Marx K (1986) Critique of the Gotha Programme. In: Dutt CP (ed). International Publishers, p. 10). To understand what “a higher phase of communist society” means, one must be attentive to a Lenin observation made in December 1919, “If we were to ask ourselves is what way communism differs from socialism, we would have a reply that socialism is the society which grows directly out of capitalism, that it is the first form of the new society. Communism, on the other hand, is a higher form of society, which can develop only when socialism has taken firm hold … . [in communism] people become accustomed to the performance of public duties without any specific machinery of compulsion, when unpaid work for the common good becomes the general phenomenon.” (Ibid., p. 97). Marx’s use of Blanc’s proposition does not imply that “the individual must lend his ability to the community for the sake of equality of condition”, observed G. A. Cohen (see Cohen GA (1995). Self-ownership, freedom and equality. Cambridge University Press, p. 126). However, Lenin seems utterly to suggest otherwise.
- 160.
By no means do I intend to imply that the West is the model to pursue in Iran. However, and to the best of my knowledge, there are no successful models existing today that at least resemble and are compatible with what the Western model, at least theoretically, can offer.
- 161.
Herzfeld E (1941) Iran in the Ancient East. Oxford University Press, pp. 286–287.
- 162.
Samuelson P (1997) Economics: The Original 1948 Edition, first edition. McGraw-Hill/Irwin, pp. 12–13.
- 163.
It should be noted that the interpretation of these issues is a matter of expertise and field studies. For instance, in political science the issue concerns for whom deals with whose interest are being served (through policy decisions and formulation) and whose welfare is being ignored. (See Benvenisti E, Nolte G (eds) (2007) The Welfare State, Globalization, and International Law. Springer-Verlag; and Whitfield D (2001) Public Services or Corporate Welfare: Rethinking the Nation State in the Global Economy. Pluto Press).
- 164.
Pollock F (1982) State Capitalism: Its Possibilities and Limitation. In: Arato A, Gebhardt E (eds) The Essential Frankfurt School Reader. Continuum Publishing Company, p. 75.
- 165.
Bataille G (1997) The Bataille Reader. In: Botting F, Wilson S (eds). Blackwell Publisher, p. 23.
- 166.
Carr EH (1979) The Russian Revolution from Lenin to Stalin. Free Press, pp. 109–110.
- 167.
It is very common to view planning as a socialist instrument of economic management. However, as Stevenson points out, “during the inter-war years socialist writers such as G. D. H. Cole advocated planning in contradiction to the chaos, irrationality and waste of the capitalist system. Capitalism was indicted as a gigantic muddle, whereas socialism stood for rationality and a co-ordinated approach to economic and social question—planning was the practical expression of socialism. Thus in 1934 Barbara Wootton in Plan or no Plan advocated the advantages of economic planning and central, public management in promoting equality, fairness and a reduction in unemployment, while Douglas Jay in The Socialist Case in 1938 argued that collectivist planning was the only way to achieve a just and fair society. But while socialist concerns for planning was important … the most significant feature of the inter-war years was the acceptance by middle opinion of the need for planning without the destruction of the capitalist system. Hence planning was not a uniquely left-or-right-wing cause between the wars, it was a response from progressive capitalists, professional people, academics, centrist politicians and socialists who found in it a means of advance over a wide range of social and economic problems.” (See Stevenson J (1986) ‘Planner’s moon? The Second World War and the planning movement’. In: Smith HL (ed) War and social change: British society in the Second World War. Manchester, p. 66.)
- 168.
Milovan Djilas also underlined a similar notion when he wrote, “In [former] Yugoslavia, it has been officially declared that planning is conducted according to Marx; but Marx was neither a planner nor a planning expert. In practice, nothing is done according to Marx. However, the claim that planning is conducted according to Marx satisfies people’s consciences and is used to justify tyranny and economic domination for ‘ideal’ aims and according to ‘scientific’ discoveries.” (See Djilas M (1957) The New Class: An Analysis of the Communist System. Frederick A. Praeger Publisher, p. 104).
- 169.
In that speech, Stalin reiterated the main aim of planning as he said. “It is sometimes asked whether it is possible to slow down the tempo somewhat, to put a check on the movement [industrialization]. No Comrades, it is not possible! The tempo must not be reduced! On the contrary, we must increase it as much as is within our power and possibilities … To slacken the tempo would mean falling behind. And those who fall behind get beaten … one feature of the history of old Russia was the continued beatings she suffered because of her backwardness … All [countries, e.g., Poland, Japan, British, France, etc.] beat her because of her backwardness, because of her military backwardness”. See Ellman M (1989) Socialist planning, 2nd edition. Cambridge University Press, pp. 12–13.
- 170.
See von Mises L (1981) Socialism: An Economic and Sociology Analysis. Trans: Kahane J. Liberty Classic, pp. 520–522; and Trotsky L (2004) The Revolution Betrayed. Dover Publication.
- 171.
Rush F (2004) The Cambridge Companion to Critical Thinking. Cambridge University Press, pp. 180–182.
- 172.
Horkheimer M, Adorno TW, Schmid NG (2002) Dialectic of enlightenment: philosophical fragments. Stanford University Press, p. 249.
- 173.
In another way, in an absence of social ownership, what prevails is a capitalist planned economy. While this distinction is far from flawless, it provides a sufficient foundation to continue the present discussion. This is because of the importance of social ownership, which cannot be overemphasized. The principle function of social ownership is to create the economic basis for the autonomous organization of society because social ownership, by definition, denotes property that is owned by those who operate and use it (for an illuminating analysis of the subject, see Cocutz JT (1953) Does Social Ownership Have Any Meaning? Ethics 64(1), pp. 46–50). Moreover, many prominent proponents of a socialist planned economy also explicitly underlined the significance of social ownership. For instance, Lenin observes, “And given social ownership of the means of production, given the class victory of the proletariat over the bourgeoisie, the system of civilized cooperators is the system of socialism.” (See Lenin, “On Co-operation,” at: https://www.marxists.org/archive/lenin/works/1923/jan/06.htm).
- 174.
It should be noted, “the term state capitalism was first coined by Wilhelm Liebknecht, founder of the Social Democratic Party of Germany. The phrase was later used by Lenin, to indicate what he perceived to be a positive direction of progress for the fledgling Soviet economy. However, neither of these early usages corresponds to the nature of state capitalism as we see it today. The socialist thinkers at the time of Liebknecht generally used the phrase to criticize an “incomplete” transition towards capitalism and a betrayal of its ideals. Lenin emphasized that state capitalism is only a temporary interim placeholder for full socialism, and in any case it should be a small part of his new economy. State capitalism as it exists today only began to take shape during the middle of the last century.” (See Li J (2015) State capitalism: Leviathan Economics of the Future. Yale Economic Review, Feb 13, 2015).
- 175.
Pollock F (1982) State Capitalism: Its Possibilities and Limitation. In: Arato A, Gebhardt E (eds) The Essential Frankfurt School Reader. Continuum Publishing Company, pp. 72–73.
- 176.
Postone M (2003) Time, labor, and social domination: A reinterpretation of Marx’s critical theory. Cambridge University Press, p. 90.
- 177.
For an example of the former, see James CLR (1986) State Capitalism and World Revolution. Charles H. Kerr Publishing Company, pp. 53–56.
- 178.
See Habermas J (1971) Toward a rational Society: Student Protest, Science and Politics Vol. 404. Beacon Press.
- 179.
Habermas J, Seidman S (1989) Jürgen Habermas on Society and Politics: A Reader. Beacon Press, p. 275.
- 180.
This does not mean, as Pollock noted, “all details are planned in advanced or that no freedom of choice at all is given to the consumer. But it contrasts sharply to the market system inasmuch as the final word on what needs shall be satisfied, and how, is not left to the anonymous and unreliable poll of the market, carried through post festum [not comparable], but to a conscious decision on ends and means at least in a broad outline and before production starts.” (Pollock F (1982) State Capitalism: Its Possibilities and Limitation. In: Arato A, Gebhardt E (eds) The Essential Frankfurt School Reader. Continuum Publishing Company, p. 75).
- 181.
Many economists stress the importance of property rights in contemporary economics. For instance, Ronald. H. Coase conceives economics as “the study of property rights over scarce resources. The question of economics, or of how prices should be determined, is the question of how property rights should be defined and exchange, and on what terms.” (see Coase RH (1960) The Problem of Social Cost. The Journal of law and Economics, Vol. III, pp. 1–44).
- 182.
It should be noted that while in The Iranian Supplementary Constitution of October 7, 1907, the notion of ownership was never even mentioned, in the Constitution Article 46 clearly states that, “Everyone is the owner of the fruits of his legitimate business and labor,” and Article 47, which confirms that, “Private ownership, legitimately acquired, is to be respected”. And yet the term that must be noted is “legitimately”, to which no clear definition was given. Indeed, for patronage of private property ownership, the notion of security and protection were the equivalent of private ownership rights. For the founder of the Constitution, for instance, one central objective of the government was urgency of “personal protection and security of property.” (See Alexander Hamilton, quoted in Farrand M (ed) (1911) The records of the federal convention of 1787 (Vol. 1) at p. 534; Laitos J (1998) Law of Property Right protection: Limitations on Government Powers. Aspen Publishers, pp. 3–43). For an informative discussion of this topic, see Ehsani K (2014) The Politics of Property in The Islamic Republic of Iran. In: Arjomand SA, Brown NJ (eds) The Rule of Law, Islam, and Constitutional Politics in Egypt and Iran. State University of New York Press, pp. 153–177. For an in-depth analysis of property and ownership see, Rose CM (1994) Property and Persuasion. Westview Press.
- 183.
Pollock F (1941) Is National Socialism a New Order? Zeitschrift für Sozialforschung/Studies in Philosophy and Social Science IX, p. 442.
- 184.
For instance, in the pre-1978 revolution individuals like Sabet, Akhvan, Farmanfarmayan, Rezai brothers, Khayami, etc, were major asset holders in various industries. By the same token, those who step outside the drawn boundaries will be punished. For instance, Putin’s imprisonment of Mikhail Khodorkovsky, formerly the richest man in Russia, shows the measures to which state capitalist Russia will resort to nullify disobedience from its economic aristocracy.
- 185.
Pollock F (1941) Is National Socialism a New Order?. Zeitschrift für Sozialforschung/Studies in Philosophy and Social Science IX, pp. 442–443.
- 186.
Ibid., pp. 444–445.
- 187.
In contrast, one can point to the successful Japan Economic Planning Agency (see Ikeo A (2002) Japanese Economics and Economists Since 1945. Routledge); South Korea state economic planning (see Kim KJ (2007) The Development of Modern South Korea: State Formation, Capitalist Development and National Identity. Routledge); or Malaysia State Planning ministries and agencies (see Khoo BT (2012) Policy Regimes and the Political Economy of Poverty Reduction in Malaysia. Palgrave Macmillan). It should be noted that none of these countries’ economic planning model was ever considered as a viable alternative in Iran.
- 188.
Khomeini I (1981) Islam and Revolution: Writing and Declarations of Imam Khomeini (1941–1980). Trans: Algar H. Mizan Press, p. 55.
- 189.
Weiner M, Banuazizi A (1994) The Politics of Social Transformation in Afghanistan, Iran, and Pakistan. Syracuse University Press, p. 261. From an economic perspective, it is obvious why the government refused to grant or even entertain the notion of social ownership. Social ownership awards autonomy by granting two major rights to those who operate and use a property. The first is related to the notion of right to property (property right) including: (1) freedom of choice in the use of property; and (2) freedom to buy and sell property. Second is an ability to set the price of a product and the ability to self-manage. Therefore, when such autonomy is conceded, an enterprise (owned and operated by the workers) gains a right to own a property, and hence is enabled to buy and sell inputs and products; and is also enabled to set the prices of the products, and therefore empowered to capture earned income. As a result, wholesale and retail trade/exchange cannot be monopolized by the state. (For a detailed analysis, see Gaidar Y (ed) (2003) The Economics of Transition. MIT press).
- 190.
For instance, the Revolutionary Council approved the Law for the Protection and Expansion of Iranian Industries, to deal with the prevailing difficulties in the industrial sector. (See Amid J, Hadjikhani A (2005) Trade, Industrialization and the Firm in Iran: The Impact of Government Policy on Business. I. B. Tauris, p. 69).
- 191.
For instance, Article 44 of the 1979 constitution envisaged three economic sectors: state, cooperative and private. See http://www.en.ipo.ir/index.aspx?siteid=83&pageid=822. The constitution, however, was subjected to intense scrutiny and criticism because it did not reflect the revolutionary spirit of the time: “in the economic articles of the new constitution, there is no mentioned of the struggle against imperialism and its local base … they say that as it is not capitalism and it is not socialism, it must be Islamic … but there is no talk of an Islamic society”. (See Pesaran E (2011) Iran’s Struggle for Economic Independence: Reform and Counter-Reform in the Post Revolutionary Era. Routledge, p. 45).
- 192.
Weiner M, Banuazizi A (1994) The Politics of Social Transformation in Afghanistan, Iran, and Pakistan. Syracuse University Press, p. 262.
- 193.
For a cooperative nature of bazaar in Iran, see Keshavarzian A (2007) Bazaar and State in Iran: The Politics of the Tehran Marketplace, Cambridge University Press.
- 194.
According to X. de Planhol, “The origins of this system do not go back to the Prophet, who gave land to his warriors, but traditionally to ‘Umar who reverted to the old principle of collective tribal property under the form of appropriation to the central authority – the original meaning of the word waqf before it took on that of mortmain or religious trust.“ (de Planhol X (2000) The Geographical Setting [of Islamic Society and Civilization]. In: Holt PM, Lambton AKS, Lewis B (eds) (2000) The Cambridge History of Islam, volume 2B. Cambridge University Press, p. 459–460).
- 195.
Cahen C (1970) Economy, society, institutions. In: Holt PM, Lambton AKS, Lewis B (eds) (2000) The Cambridge History of Islam, volume 2B. Cambridge University Press, p. 519.
- 196.
Crecelius D (1995) Introduction. Journal of Economic and Social History of the Orient. 38(3): 247–261, p. 260.
- 197.
In the conventional economic theory, rational consumers of public goods would tend to look for a free ride, and hence they would fail to contribute to the costs of creating these goods. Consequently, under the conditions of rational behavior, public goods would tend to be under-produced (See Bates RH (1997) Social Dilemmas and Rational Individuals: An Assessment of the New Institutionalism. In: Harriss J, Hunter J, Lewis CM (eds) The New Institutional Economics and Third World Development. Routledge).
- 198.
See Kuran T (2001) The Provision of Public Goods under Islamic Law: Origins, Impact, and Limitations of the Waqf System. Law & Society Review 35(4): 841–898. See also Hassan MK, Lewis MK (eds) (2014) Handbook of Islam and Economic Life. Edward Elgar Publishing, pp. 542–543.
- 199.
Cizakca M (1998) Awqaf in History and Its Implications for Modern Islamic Economies. Islamic Economic Studies 6(1), p. 45.
- 200.
For those who may be dissatisfied with this description, I suggest John Dewey’s book, How we think, in which decision-making is broken up into several steps: problem identification, research of solutions, decision, implementation, and evaluation. (See Dewey J (2008) How we think. Cosimo).
- 201.
Kydland F, Prescott E (1977) Rules Rather than Discretion: the Inconsistency of Optimal Plans. Journal of Political Economy 83(3): 473–491.
- 202.
See Mill JS (1991) Consideration of Representative Government. Prometheus Book, p. 145.
- 203.
Daft RL (1982) Bureaucratic Versus Nonbureaucratic Structure and the Process of Innovation and Change. Research in the Sociology of Organization 1: 129–166, p. 139.
- 204.
Mazuri AA (1968) From Social Darwinism to Current Theories of Modernization: A Tradition of Analysis. World Politics 21(1), p. 76.
- 205.
North DC, Thomas RP (1973) The Rise of the Western World: A New Economic History. Cambridge University Press.
- 206.
Gerschenkron A (1962) Economic Backwardness in Historical Perspective: A Book of Essays. Fredrick A. Praeger, p. 6.
- 207.
A rational system is general composed of (1) efficiency criteria with optimization as its main objective, (2) development of general guidelines of how to formalize organizational structure and relationship, (3) bureaucratization, that is, administrative structure through rational-legal authority as the primary organizational structure of a society, and (4) rational decision making, in which goal specificity and formalization contribute to rational conduct in an organizational setting. However, as Binder noted, “The rational systems usually pay lip service to democratic ideas, but they shun the democratic conventions.” (See Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 45).
- 208.
It is noteworthy that even the Western conventional system is changing rapidly in the sense that economic, political and social decision-making has increasingly been transferred beyond the direct control of head of state or national assemblies, e.g., parliaments, globalization, Europeanization and the growth of non-majoritarian institutions impact the way in which national authorities can decide on policies. In many ways their hands are tied by the European Union, central banks, and legal authorities. The margins of decision-making are getting smaller and decision-making increasingly involves regulation. In particular, politicians create institutions and rules that limit their freedom to act later on.
- 209.
In contrast, in the pre-constitutional Iran, legitimization was delegation of authority, contractual agreements, granting noble titles, marriages, and the like.
- 210.
Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 45.
- 211.
According to Glenn E. Curtis and Eric Hoogland, “Iran’s economic development plans have been of varying lengths and have had various nomenclature. Under Mohammad Reza Shah, five plans were completed, and a sixth was in progress at the time of the Islamic Revolution of 1978–79. The Islamic Republic has had formal five-year economic development plans since 1990, the fourth of which began in March 2005. The plans begin and end in March in accordance with Iran’s fiscal year (q.v.) and the Iranian calendar year.” (See Curtis GE, Hoogland E (2008) Iran: A Country Study. Area handbook series, Federal Research Division. In Library of Congress, p. 327).
- 212.
“According to a study conducted by Iran’s central bank in 1937–1938, of the 14.9 million population of Iran, 83 percent lived in rural areas”. (See Sharifi M (2013) Imagining Iran: The Tragedy of Subaltern Nationalism. Lexington Books, p. 77).
- 213.
For instance, prevalence of infectious diseases such as typhus and cholera were common in Iran up to the 1930s, mostly because of the lack of adequate sewerage systems in both rural and urban areas, public water supply and sanitation services, and national and local inoculation programs, etc. In fact, according to Cyrus Schayegh, a debate over eugenic issues at the national level was only initiated in the middle of the twentieth century. (See Schayegh C (2010) Eugenics in Interwar Iran. In: Bashford A, Levine P (2010) The Oxford Handbook of the History of Eugenics. Oxford University Press).
- 214.
However, “General Ali Razmara, who became prime minister in June 1950, failed to convince the oil company of the strength of nationalist feeling in the country and in the Majlis. By the time the AIOC finally offered 50–50 profit sharing in February 1951, sentiment for nationalization of the oil industry had become widespread. Razmara advised against nationalization on technical grounds and was assassinated in March 1951 by a member of the militant Islamic Warriors (Fedayan-e Islami). On March 15, the Majlis voted to nationalize the oil industry. In April the Shah [Mohammad Reza Pahlavi] yielded to Majlis pressure and demonstrations in the streets by naming Mossadeq prime minister. Oil production came to a virtual standstill as British technicians left the country, and Britain imposed a worldwide embargo on the purchase of Iranian oil. In September 1951, Britain froze Iran’s sterling assets and banned the export of goods to Iran. It also challenged the legality of the oil nationalization, taking its case against Iran to the International Court of Justice at The Hague. The court found in Iran’s favor, but the dispute between Iran and the AIOC remained unsettled. Under U.S. pressure, the AIOC improved its offer to Iran. The excitement generated by the nationalization issue, anti-British feeling, agitation by radical elements, and the conviction among Mossadeq’s advisers that Iran’s maximum demands would, in the end, be met, however, led the government to reject all offers. The economy began to suffer from the loss of foreign exchange and oil revenues.” (Curtis GE, Hoogland E (2008) Iran: A Country Study. Area handbook series, Federal Research Division. In Library of Congress, p. 33).
- 215.
Internationally, one of most significant of Ebtehaj’s achievements was when “he concluded an agreement with Great Britain and Russia to pay back 60% of the amount of currency they received for their expenses during the War by gold, and 40% by gold guaranteed Pounds Sterling and dollars. This saved Iran’s assets from the drastic devaluation of the Pound Sterling in 1949. Ebtehaj was also instrumental in placing Iran’s currency on the gold standard by changing the official currency from dual silver- and gold-based rials to gold-based rials; it later contributed to maintaining Iran’s currency parity vis-à-vis foreign currencies.” (See http://www.iranicaonline.org/articles/ebtehaj-abolhassan. See also Bostock F, Jones G (1989) Planning and Power in Iran. Ebtehaj and Economic Development under the Shah. Routledge, pp. 45–48, 63–68).
- 216.
See Zonouz BH (2010) The Study of Economic Planning System in Iran (Pre-Islamic Revolutionary Period). The Office of Plan and Budget Studies of Majlis Research Centre (MRC).
- 217.
Mohammed Mossadegh is an immense historical figure in Modern Iranian History. Born to an elite and wealthy family in Tehran, Mirza Mohammed Khan received his law degree from Neuchatel University in Switzerland. Upon his return to Iran in 1914, and in recognition of his late father’s service to the Qajar crown, the monarch Nasir al-Din Shah gave him the noble title of “Mossadegh al-Saltaneh”. In 1929 Mohammed Khan Mossadegh al-Saltaneh was appointed to the governorship of Fars Province, but after the coup of 1921, led by Seyyed Zia’eddin Tabatabaee (the last prime minster of Iran under Ahmad Shah, the last Shah of Qajar dynasty), he resigned. Later, Mossadegh was appointed as Iran’s minister of finance during Qavām os-Saltaneh (also known as Ahamd Qavām) who was jailed by Tabatabaee in 1921 but soon after the fall of Tabatabaee government appointed as prime minister of Iran. In later years Mossadegh opposed the elevation of Reza Khan Mirpanj to the status of Reza Shah in 1925. As result, he was forced out of public life until Reza Shah was forced by England and the Soviet Union to abdicate in favor of his son Mohammad Reza Pahlavi, and the rest, as they say, is history. It should also be noted that Mossadegh was not the exception and there were many who occupied important positions in the Pahlavi government that have ties with the Qajar monarchy. For instance, Ali Amini, hand picked by Mohammad Reza Pahlavi as a minister and prime minister, was the offspring of wealthy and aristocratic family that had served the Qajar dynasty.
- 218.
Iran Chamber Society (2015) History of Iran: Oil Nationalization. Available at: http://www.iranchamber.com/history/oil_nationalization/oil_nationalization.php.
- 219.
Ferraro V (2008) Dependency Theory: An Introduction. In: Secondi G (ed) The Development Economics Reader. Routledge, p. 58.
- 220.
Amuzegar J (1991) Dynamics of the Iranian Revolution: The Pahlavis’ Triumph and Tragedy. SUNY Press, p. 181.
- 221.
Inflation occurred as the injected domestic credit increased aggregate demand but production did not rise to meet the growing demand.
- 222.
Amuzegar J (1991) Dynamics of the Iranian Revolution: The Pahlavis’ Triumph and Tragedy. SUNY Press, p. 174.
- 223.
This era corresponded to the rise of Ali Amini, a French educated PhD economist. Amini’s major achievement was to keep the economy functioning despite a severe lack of revenue and savings at the time. He is also credited with the reform of the tax machinery and institutions to implement the country’s first comprehensive progressive tax structure. (See Sadr EI (2013) To Whisper in the King’s Ear: Economists in Pahlavi and Islamic Iran, PhD Dissertation. University of Maryland, College Park, pp. 47–49).
- 224.
Curtis GE, Hoogland E (2008) Iran: A Country Study. Area handbook series, Federal Research Division. In Library of Congress, p. 147.
- 225.
- 226.
Ibid.
- 227.
Karshenas M, Pesaran HM (1995) Economic Reform and the Reconstruction of the Iranian Economy. The Middle East Journal 49(1), p. 89.
- 228.
For instance, the second plan outlined: the need for utilization of monetary instruments such as issuing treasury bonds; the importance of a positive level of interest rates on deposits to encourage saving as well as providing more resources for financing; the need to preserve the value of the national currency by measures such as revision of banking regulations. These selected agendas and instruments, however, clearly underlined what has been absent in Iran for more than a hundred years, that is, a polity that will enact and enforce the necessary rules as well as institutional settings to attain them.
- 229.
Amoee BA (2005) Political Economy of Islamic Republic., Gum-e nu Publisher, p. 31.
- 230.
Ibid., pp. 142–144.
- 231.
The overthrow of Reza Shah by the Allies, I argue, is a telling explanation of how deep passivity run in the Iranian public mindset. This significant development in our modern history since nationalism was a product of the era. And yet, not a single voice was raised against replacement of the sovereign by the Allies, which is a revealing narrative of how the Iranians perceived their sovereignty and their servitude to power.
- 232.
The original document that later turns into the Seven Year Plan Law.
- 233.
Baldwin GB (1967) Planning and Development in Iran. Johns Hopkins Press, p. 26.
- 234.
Zonis M (2015) Political Elite of Iran. Princeton University Press, pp. 228–233.
- 235.
Ibid., p. 231. It should be noted that Zonis did not used any references or name for this quotation, which perhaps insinuates a fear for the safety of the individual as a possible reason.
- 236.
de Grazia S (1963) The Political Community: A Study of Anime. University of Chicago Press, pp. 239–240.
- 237.
Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 69.
- 238.
For instance, see McLeod TH (1964) National Planning in Iran: A Report Based on the Experiences of the Harvard Advisory Group in Iran. December 31, 1964, p. 70. See also Nemchenok VV (2009) That So Fair a Thing Should Be So Frail: The Ford Foundation and the Failure of Rural Development in Iran, 1953–1964. The Middle East Journal 63(2), pp. 261–284.
- 239.
Babb S (2001) Managing Mexico: Economists from Nationalism to Neoliberalism. Princeton University Press.
- 240.
Schneider BR (1998) The Material Bases of Technocracy: Investor Confidence and NeoLiberialism in Latin America. In: Centeno MA, Silva P (ed) The Politics of Expertise in Latin America. St. Martin’s Press, p. 78.
- 241.
To the best of my knowledge there is not a single idea in contemporary economics as a discipline that has either been formally formulated or been conceptualized by a man educated and living in the third world (the term used here, despite my utterly rejection of it, is to simply convey the point). A broader perspective of this lack of initiative can be traced back in history. According to Abraham Marcus, “modernization or Westernization did not grow organically from within the Middle East. The stimulus came from outside, from the pressures posed by the encounter with a more powerful and aggressive Europe. Disastrous Ottoman defeats on the European front in the late eighteenth century shook the leadership in Istanbul into the painful realization that the balance of power had tipped definitely in favor of Europe. The lesson sank deeper when Napoleon’s army easily captured the province of Egypt in 1798. Alarmed by the mounting European threat, rulers in the region moved to shore up their defenses by reorganizing their armies, administration, and societies along the lines of a Western Model, now seen as the proven path to success. With their sponsorship and independence, Europe penetrated the region as never before. European ideas, manners, advisors, investors, goods, capital, armies, and diplomatic intervention now shaped increasingly the world of the Middle Easterners”. (Marcus A (1989) The Middle East on the eve of modernity: Aleppo in the eighteenth century. Columbia University Press, p. 1).
- 242.
With all due respect to Western diploma holders, including myself, there must be a distinction between Western educated and Western trained, where the former implies embeddedness of “critical thinking”, and hence rejection of conformity, while the latter simply connotes qualification to advocate certain topics or do certain tasks.
- 243.
It has been suggested that Ebtehaj was one of the promoters of such a mentality. However, it should be noted that, in Iran, competence is sometime perceived as arrogance, particularly by those who lack it.
- 244.
Sharifi M (2013) Imagining Iran: The Tragedy of Subaltern Nationalism. Lexington Books, p. 9.
- 245.
Chehabi HE (1990) Iranian politics and religious modernism: the liberation movement of Iran under the Shah and Khomeini. Cornel University Press, p. 107.
- 246.
It should be noted that this erosion of legitimacy was less rampant during the constitutionalist movement but more prevalent during the Pahlavi Monarchy.
- 247.
Until then “there were a number of higher institutions already existing, they functioned independently of one another, some attached to the Ministry of Education and the rest to other ministries. By 1927 there were seven such colleges (or faculties), namely: Law, Medicine, Arts and Science (included in the Teachers Training College), Theology, War, Agriculture, and Veterinary Medicine.” (See Arasteh AR (1962) Education and Social Awakening in Iran: 1850–1960. E. J. Brill, pp. 25–26).
- 248.
Ibid., table. 1, p. 28. Furthermore, during the interwar period (1930s), as Arasteh observed, “about 700 high school and college graduates accepted government employment. The best jobs went to those who had been educated abroad.” (Ibid., p. 31) He also underlined, “of the forty-six minister of education who served from 1860–1940, only one had been trained as an educator; the rest were lawyers, scholars, medical doctors, etc.” (Ibid., footnote no. 20 in Chap. 1).
- 249.
For a brief but informative discussion of the topic of legitimacy, see “political legitimacy” in Stanford Encyclopedia of Philosophy at: http://plato.stanford.edu/entries/legitimacy/.
- 250.
According to Binder, these formulas comprised five platforms: (1) Aristocracy of Qajari tribalism; (2) Constitutionalism with Majlis as its Symbol; (3) Monarchial declaration of the Pahlavi Dynasty; (4) Theocracy that rose against Constitutional Revolution; and (5) Nationalism of Mosaddegh and rise of the religious nationalism group (see Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 62).
- 251.
Baldwin GB (1967) Planning and Development in Iran. John Hopkins University Press, pp. 14–15.
- 252.
Wilber DN (2014) Iran Past and Present: from Monarchy to Islamic Republic. Princeton University Press, p. 130.
- 253.
In this study, the word modernity simply means “what leaves or struggles to leave the past behind … a prescriptive rallying call to where we ought to be, the over determining adverb expressive of the desire to wipe out the past completely”. (See Prendergast C (2003) Codeword Modernity. New Left Review 24, Nov/Dec 2003, p. 99). Having said that, there is no doubt that modernity, modernization, and modernism are all part of a more or less similar transition. The link between them can be realized by identifying modernization as the process whereby we get there, and modernism as a reaction to that situation. Therefore, modernity can be tied to a situation of unfinished modernization, or as Prendergast noted, “It is a structure of hope, fear, and fantasy invested in an emergent formation and a possible future.” (Ibid.) Also Matthew K. Shannon stated, “Overseas Consultants, Inc. (OCI), the most influential of the Shah’s army of Western advisers, determined in its multi-volume 1949 report that overseas training was “highly desirable” and ‘assures the latest and best technical training and provides valuable contacts with foreign societies.’ ” (see Shannon MK (2014) American-Iranian Alliance: International Education, Modernization, and Human Rights during the Pahlavi Era. Diplomatic History, July 31, 2014, p. 5).
- 254.
According to Hamid Algar, Mansur, the prime minister, was also responsible for the exiling of Ayatollah Khomeini. (See Algar H (1991) Religious Forces in Twentieth-Century Iran. In: Avery P, Hambly G, Melville C (eds) The Cambridge History of Iran (Vol. 7): From Nadir Shah to the Islamic Republic. Chapter 20. Cambridge University Press, Cambridge, p. 755).
- 255.
In fact, Mohammad Reza Pahlavi was also a change agent: a product of Switzerland’s LeRosey boarding school, and his view of progress embraced modernity, as he stated, “Today, Tehran has the most modern milk-pasteurization factory … in the streets of Tehran double decker buses, similar to those in London, are in used … today peasants like to drive jeep vehicles, so we start up jeep manufacturing … in the past people and governmental offices communicated through sending letters or asked the servants to take messages, today they can do it by telephone … .” (See Pahlavi MR (1961) Mission for My Country. Amir Kabeer Publisher, Tehran, pp. 178–179). (Excerpt translated by the author).
- 256.
Milani A (2001) The Persian Sphinx: Amir Abbas Hoveyda and the Riddle of the Iranian. Revolution. Mage Publishers, pp. 141–142.
- 257.
Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 92.
- 258.
In a sense, it offers no justification for legitimization of power relations except for reiterating that people have faith in a particular order because it has been there for a long time (tradition).
- 259.
Mansoor Moaddel also underlined a similar pattern of discourse between traditionalists and competitors (see Moaddel M (2005) Islamic Modernism, Nationalism, and Fundamentalism: Episode and Discourse. University of Chicago Press).
- 260.
Baldwin GB (1967) Planning and Development in Iran. Johns Hopkins Press, p. 28.
- 261.
For more in-depth narrative of this case see Ibid., pp. 27–31.
- 262.
This observation is made knowing only too well that it is against significant sentiment inside and outside Iran. However, before making a hastily and outright rejection, I suggest the following. (1) During the 8 years of Mr. Ahmadinejad’s government, various economic problems were exacerbated but none was created. In other words, his government did not add new problems to the existing ones. (2) A claim has been make to suggests that a significant portion of economic as well as social problems could have been solved during these 8 years, mainly because the government revenue from oil exports had reached an unprecedented level in history. Another way of saying the same thing is that money can solve our problems. It cannot. Indeed, one of our main problems is the fact that oil revenue plays an important role in our economy. (3) Some also point to various corruption and embezzlement cases in which members of the government were either directly involved or looked the other way. If these cases prove to be accurate, the problem is not the amount involved but rather the occurrences of corruption and its extent, all of which are neither new phenomena, nor new developments in our country.
- 263.
Binder L (1962) Iran: political development in a changing society. Univ of California Press, p. 315.
- 264.
See Lynd RS (1948) Knowledge For What? Princeton University Press, p. 44. On a similar note, writing on German history in the 1920, Weimar culture has come to be regarded as the similar embodiment of conscious construction, which ended disastrously wrong. (See, for instance, Lamb S, Phelan A (1995) Weimar Culture; the Birth of Modernism. In: Burns R (ed) German Culture Studies: An introduction. Oxford University Press, pp. 53–99; and Peukert DJK (1993) The Weimer Republic: The Crisis of Classical Modernity. Hill and Wang).
- 265.
Michael Young who first coined the term, meritocracy, defined the term, in an administrative sense of the word, as a system of government (or other administration apparatus) in which appointments and responsibilities are assigned to individuals as a result of their “merits” (including intelligence, credentials, and education) that are determined through various assessments and evaluations. (See Young MD (1961) The rise of the meritocracy, 1870–2033: An essay on education and inequality. Penguin). In this light, meritocracy measures progress, as Young insinuates, in the sense that Western advanced societies are held to be those that are more meritocratic. For instance, in these societies fewer decisions are made based on self-interest and opportunism. Ansgar Allen also noted, “Meritocracy is sometimes used as a measure of corruption, where corrupt societies or corrupt institutions are thought to be those that disobey the formula: merit = ability + effort. Meritocratic societies are open and fair, non-meritocratic ones are obscure and underhand. Justice, social cohesion, progress, fairness, and transparency; these are the timeless ideas upon which meritocracy is presumed to rest.” (See Ansgar A (2011) Michael Young’s The Rise of the Meritocracy: A Philosophical Critique. British Journal of Educational Studies 59(6), p. 368).
- 266.
Holliday F (1979) Iran: Dictatorship and Development. Pelican Book, p. 138.
- 267.
Amuzegar J (1991) The dynamics of the Iranian revolution; the Pahlavis’ triumph and tragedy. State University of New York Press, New York, p. 305.
- 268.
Interestingly enough, in 1973 the Italian journalist Oriana Fallaci conducted an interview with Mohammad Riza Pahlavi in which the Shah questioned the relevance of Western political values to the Iranian society (see Fallaci O (1976) Interview with History. Liveright Publishing Corporation, pp. 274–275):
OF: Maybe I explained myself badly, Majesty. I meant democracy as we understand in the West, namely a regime that permits anyone to think as he likes and is based on a parliament when even minorities are represented …
MRP: But I don’t want that kind of democracy! Don’t you understand? I wouldn’t know what to do with such a democracy! It’s all yours, you can have it! Your wonderful democracy! You’ll see, in few years, where your wonderful democracy leads.
OF: Well, maybe it’s a little chaotic. But it’s the only thing possible if you respect man and his freedom of thought.
MRP: Freedom of thought, freedom of thought! Democracy, democracy! With five-year-old children going on strike and parading through the streets. That’s democracy? That’s freedom?
OF: Yes, Majesty.
MRP: Well, not to me. And let me add: how much studying have you done in the last few years in your universities? And if you go on not studying in your universities, how will you be able to keep up with the needs of technology? Won’t you become servants of the Americans thanks to your lack of preparation, won’t you become third- or even fourth-rate countries? Democracy, freedom, democracy? But what do these words mean?
- 269.
On the latter point an example may clarify the point. Joining the global economy and financial market for Iran at this time is utterly useless on simple grounds. In Iran, Thursday and Friday are considered the weekend while the rest of the world, the end of a week is Saturday and Sunday. Iran, therefore, can only link to the global economy on three (out of seven) days per week.
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Pirzadeh, A. (2016). Contemporary Iran and the Iranian Economy. In: Iran Revisited. Arts, Research, Innovation and Society. Springer, Cham. https://doi.org/10.1007/978-3-319-30485-4_7
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