Conference Paper
Poverty and Inequality in Iran: From Land Reform to the Present
No.
ERF32AC_200
Publisher
ERF
Date
May, 2026
Topic
I3. Welfare, Well-Being, and Poverty
This paper traces the evolution of poverty and inequality in Iran, emphasizing the enduring impact of the country’s feudal past on distributive outcomes since the 1960s. The period under study is marked by profound social and structural transformation and by distinct inequality regimes. The land reform of the 1960s, which dismantled Iran’s feudal system of land tenure, was followed by rapid industrial growth sustained by the migration of unskilled agricultural workers—excluded from land redistribution—to urban areas. This “golden age” of industrial expansion gave way in the 1970s to a rentier economy fueled by the oil boom, which intensified income inequality. Accounting for the influence of Iran’s pre-revolutionary agrarian class structure on inequality after land reform is essential for understanding the persistence of high inequality in subsequent decades—both in the 1970s, when it likely contributed to the revolutionary crisis that toppled the monarchy, and in the post-1979 period, when the Islamic Republic’s promise of social equity largely went unfulfilled. The analysis relies on household survey data — available in tabular from before 1983 and in unit-record thereafter — to document long-term trends and the dynamics of poverty and inequality across these structural shifts.
Research Fellows
Djavad Salehi-Isfahani
Professor, Virginia Tech University