The Systemic Model of Labor Supply in Iran: A Study with Qualitative Systems Dynamics Approach

Human resources is one of the most important factors of production that plays an effective role in the economic growth and development of the country. The Human Resources market is more sensitive compared to other markets; because in addition to being affected by economic factors, it is also affected by social and demographic factors. In this research, the determinants of labor supply in Iran were studied by developing a system model based on the qualitative system dynamics Approach. This method helps the policymakers to get a deep understanding of the complexities and delays in the system by seeing the different fields as interdependent. The labor force participation rate as the proportion of the working-age population of a country that is active (employed or unemployed) in the labor market is an indication of the relative supply of labor. The paper uses expert opinions and previous research to identify demographic, economic, and social factors that affect labor force participation, such as marriage, fertility, retirement, immigration, economic growth, job opportunities, human capital, and corruption. According to the results, with the increase in GDP and consequently the increase in job opportunities, the probability of finding a job increases, and foreign migrations decrease. This path, together with the increase in the retirement age and the reduction of corruption, which faces the path of economic growth with many obstacles, can lead to an increase in the labor supply.