The role of manufacturing on Iran's economic growth: Divisa’s Logarithmic Index Method

This article discusses the role of manufacturing in the economic growth of Iran using the logarithmic mean Divisia index (LMDI) method. The study identifies various drivers of industrialization and their impact on growth, including structural changes (productivity of labor and employment share in industrial factories) and employment scale. The LMDI method is used to analyze with a dataset from Iranian provinces between 1381 and 1399. The results show that industrialization has a positive and significant effect on economic growth, with structural changes having a greater impact than employment scale. The study highlights the importance of sustainable industrial development for economic growth in Iran.