Economic Trends and Macroeconomic Policies in Post-Revolutionary Iran

This paper reviews some of the main trends in the Iranian economy over the past two decades and discusses the key economic policy issues that divide the reformist from the more conservative factions in Iran. It argues that the economic policy dilemma of whether or not to liberalise the economy has not gone away. For a small open economy such as Iran operating in an increasingly globalised world economic environment, the neglect of fundamental eco- nomic forces in favour of political vested interest can have dire consequences in the long run.