Tahqiqāt-e Târix-e Eqtesâdi (Economic History Studies of Iran)

The Economic Policies of the Pahlavi State and the Transformation of Relations between Bazaar Merchants and Industrialists in Iran, 1961–1978

Articles in Press

Document Type : .

Authors

Fatameh Jalal por 1
habibollah saeedinia 2
Hojat Parsa 3
Hasan Allahyari 1

1 Department of History - Faculty of Literature and Humanities - Persian Gulf University - Bushehr - Iran

2 Department of History - Faculty of Literature and Humanities - Tehran University - Bushehr - Iran

3 Department of Economics - Faculty of Business - Persian Gulf University - Bushehr - Iran

10.30465/ehs.2026.55269.2120
Abstract
This study examines the impact of the economic policies of the Pahlavi state on the transformation of relations between bazaar merchants and industrialists in Iran between 1961 and 1978. The primary question addresses how the Pahlavi state, relying on surging oil revenues and operating within the framework of economic modernization, intervened in the balance of economic forces and restructured the relationship between the traditional bazaar and the emergent industrial sector. The central hypothesis posits that the state’s financial autonomy, derived from oil rents, facilitated direct, large-scale intervention in the economy; rather than resulting in organic economic competition, this intervention led to the systematic reorganization of relations between these two groups. Findings indicate that through tariff protections, credit allocations, import-substitution policies, price controls, the expansion of modern retail chains, and the establishment of state-dependent economic institutions, the state simultaneously empowered industrialists and curtailed certain traditional functions of the bazaar. However, this relationship was not entirely antagonistic, as a number of merchants capitalized on new opportunities to enter industrial production. Consequently, the transformation of relations between these groups was less the product of spontaneous economic evolution than the outcome of a rentier state’s interventionist paradigm.

Keywords

Rentier State
Industrialization
Traditional Bazaar
Industrialists
Pahlavi Political Economy
Dependent Bourgeoisie
State-Bazaar Relatio
Subjects
Tahqiqāt-e Târix-e Eqtesâdi (Economic History Studies of Iran)

Articles in Press, Accepted Manuscript
Available Online from 24 October 2026

  • Receive Date 24 July 2026
  • Revise Date 17 September 2026
  • Accept Date 24 October 2026

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