The Effect of Innovation and Human Capital on Iran's Economic Growth

In this paper we applied Romer’s indigenous growth model for innovation and entrepreneurship in Iran economy development and the effects of labor variables, physical capital, human capital as well as, research and development, machinery import have been studied as technology spillover. Economic time series data for 1968-2003 period is used to study the stationary variables by unit root test, and then the model is tested to study the residuals; unit equation model is used for assessment. The results show that intermediate goods, labor, human capital, physical capital and import machinery invoke the production.