The Analysis and Comprison of Productivity of Different Small and Large Scale Industrial Groups in Iran

Productivity of the factors of production is one of the important indices to measure the advantages of industries in the internal and external levels of any country. The productivity growth of the production factors decreases the production costs and increases the competitive power of the producer in the market. Thus, the entrepreneurs prefer to invest on the industries which enjoy both high value added and high productivity. This paper calculates and compares the total, average and marginal productivity of different small and large scale industries of Iran during 1366-1380. The industries are divided into nine industrial groups according to international classification I.S.I.C, Rev.2. The Cobb-Douglas production function is used for studying and calculating the total and marginal productivity. The average ratio of value added to factors of labour and capital during the period of study is used for calculating the average productivity. The paper concludes that the total, average and marginal productivity of the total small scale industries is less than the large ones. But the productivity of some groups of small scale industries is more than large ones.