Entrepreneurship and Total Factor Productivity in Iran's Manufacturing Industries

This article aims to shed light on the relationship between entrepreneurship and total factor productivity (TFP) growth in Iran''s manufacturing industry during the period 1974-2006 using a time series approach. The production function approach provides a natural point for the analysis of productivity. This approach can help to examine the relationship between TFP and its main drivers through the developed endogenous growth theories. In addition to entrepreneurship، it is expected that human capital and openness have distinct impact on total factor productivity as well. These variables are included in the empirical model. The findings of the study show that there is a positive and significant influence of entrepreneurship on the TFP in Iran''s manufacturing industry in the short run but not in the long run. Moreover، the results confirm that human capital and openness have positive and significant effects on the level and growth rate of TFP in the short run and long run.