Structure of Economy in Iran

Based on a three-part economy, agriculture, industry and service, we can take a look at the structure of economy of Iran. Graph below shows the trend for 1974-2004. As expected the share of agriculture is less than that of the other two. It was 10 percent in the beginning of the period and the same at the end. In 1974 the dominant part was industry but at the end industry goes to second rank and service becomes the dominant sector. In the middle, the agriculture is more important than before and after. In 1987, almost at the end of war, the share of agriculture grew to 25 percent. This can be explained by recession in industry.
Considering that oil is the most important part of the industry, the trends can be explained by movements in oil revenue. When the oil revenue is high, industry dominates the economy, otherwise the other sections become important. This can be seen by comparing the following graph with the graph I posted last week. Oil revenue not only directly increases the share of industry, but also indirectly affects it. Whenever the oil revenue is enough, the industry, mostly government owned, can get money to invest in new machinery, renew the old machines and more importantly buy intermediate goods necessary for production from abroad. During crisis it is harder to produce industrial goods and thus the share of industry shrinks.