Equality of Opportunity as a Driver of Prosperity: The Case of Iran

Augusto Lopez-Claros1

The economic marginalization of women and ethnic, religious, and other minorities is a pervasive problem in virtually every country in the world. There is compelling economic evidence that shows that excluding minorities from the labor force not only undermines the legitimacy of the governments practicing various forms of discrimination but also ends up eroding the competitive potential of the country in an increasingly global and integrated marketplace. Much of the evidence has focused on how unequal treatment before the law and the associated violation of people’s human rights has adversely affected various metrics of human welfare and development.

Perhaps the area that has delivered thus far the greatest insights is in respect of gender discrimination. At the World Bank over the past decade we built up a huge database comprehensively listing such discriminations embedded in the legislation of 190 countries and discovered that they are associated with various social and economic dysfunctions. The more pervasive the discriminations, the lower the number of girls attending secondary school relative to boys, the lower the labor force participation rates of women relative to men, the lower the number of women-run businesses, and the larger the gender wage gap. These discriminations involve a massive misallocation of resources and thus undermine a country´s productivity and growth potential. Tapping into this rich database and other up to date datasets like the Gender Equality and Governance Index provides a comprehensive perspective on the status of gender discrimination in 158 countries, focusing on such areas as entrepreneurship, work, education, and the legal framework and it is noteworthy that Iran ranks 157, just slightly ahead of Afghanistan, highlighting the huge economic cost borne by the Iranian economy as a result of the subjugation of its women.

Unfortunately, violations of human rights in Iran are not limited to the gender space. The Iranian government has a long history of discrimination against members of the Bahá’í community—Iran`s largest non-Muslim religious minority. The list of abuses is as long as it is depressing and highlights the extent to which the government has been willing to go to strangulate the Bahá’ís economically and socially. Government jobs have been denied to Bahá’ís since the years immediately following the Revolution. Bahá’ís are also often denied licenses and thus cannot open their own businesses. Young members of the community are excluded from public universities, and university students discovered to be Bahá’ís are expelled.

Bahá’í homes and businesses are raided by government agents and their property is often confiscated without compensation. Bahá’í holy places have been attacked and destroyed. They are not permitted to bury their dead according to Bahá’í law, and Bahá’í cemeteries have been vandalized, desecrated and destroyed. Iran’s state-sponsored news media systematically disseminate propaganda intended to incite hatred against Iran’s Bahá’í community. This propaganda often scapegoats Bahá’ís for economic and political unrest in Iran, and is characterized by a range of baseless accusations, including espionage, promiscuity, sexual deviance, armed rebellion, brainwashing and “cult-like” practices, opposition to the government, threatening national security, and blasphemy and animosity towards Islam.

There has been a recent surge in this type of propaganda: the Bahá’í International Community reports that in 2010-11, approximately 22 anti-Bahá’í pieces appeared in state-sponsored media outlets every month. By 2018-20 the number of anti-Bahá’í pieces had risen to about 740 per month, requiring a large army of scribes hired to disseminate hatred and falsehoods. Bahá’ís are routinely arrested, detained, and imprisoned. By 2020 the number awaiting trial, appeal, sentencing, or the commencement of their sentences was in excess of 400.

A more recent example of such persecutions is the case of several dozen families living in the village of Ivel, in the north of the country, who a few months ago received a sentence of expropriation of their farmland and housing after long attempts to demonstrate to local, provincial and national authorities that they were the rightful owners and had resided in Ivel for several generations, going back to the 1860s. Article 49 of Iran's Constitution allows the government to confiscate "illegitimate" property obtained through "usury, usurpation, bribery, embezzlement, theft, gambling," etc and the government used this to justify these unlawful expropriations. In the long history of harassment these local abuses often precede practices that are then implemented at the national level and that degenerate into further strangulation of the Bahá’í minority.

Prosperity and economic development consist of much more than increasing income per capita. Human well-being includes social, cultural, ethical and spiritual dimensions. The diversity and additional perspectives frequently contributed by marginalized groups can, when given the opportunity for expression and participation, enrich the community and society. Eliminating all forms of discrimination and giving people equal opportunities not only prevents a massive loss of human resources and capabilities, but opens the way for higher levels of prosperity and other manifestations of human development.

It would be of enormous benefit to Iran´s 84 million citizens if the authorities were to rethink their national priorities and redirect resources towards nobler ends, such as poverty alleviation and the reconstruction of the country´s dilapidated productive apparatus. Fanning hatred and inciting the population against a religious minority that has no political ambitions, that has a long history of respect for the law and that values peaceful coexistence with their fellow citizens, is destructive of national wealth.

Undoubtedly the adverse publicity and frequent international condemnation of these gross violations of the human rights obligations which Iran has assumed have contributed to the country's pariah status in the international community. They have discouraged foreign investment and the technology transfer and knowhow that often accompany it and have thus postponed indefinitely the modernization of the Iranian economy. They have created an highly hostile environment for private initiative and development within the country, as demonstrated by Iran´s rank of 127 out of 190 countries in the World Bank's Doing Business report, below Tajikistan, Kyrgyzstan, Uzbekistan, Mongolia and the West Bank and Gaza. The economic cost to Iran has been vast, as indicated by the fact that Iran´s income per capita in 2019 was about the same as that of Gabon and Equatorial Guinea and about a third of countries in Central and Eastern Europe which were still laboring under the strictures of Soviet-inspired central plans well into the early 1990s.

If governments are not moved to treat their citizens fairly and in ways that are consistent with their international human rights obligations, if they do not accept the moral argument for equality of opportunity, then they should do so on efficiency grounds, as a way of creating economic conditions which will improve the investment climate and lead to improvements in productivity and poverty alleviation. Iran´s poverty rate is sharply up since 2013, with millions of people falling below the poverty line.

The most sustainable path towards ending extreme poverty and promoting shared prosperity is through creating an inclusive society, allowing everyone, including traditionally marginalized groups such as ethnic, religious, and other minorities, the same opportunity to participate in and benefit from the economy. Discriminations which result in worsening income disparities will only feed social disaffection and political instability. Governments have a critical role in creating a foundation for equality of opportunity, both through dismantling laws, regulations and policies which actively discriminate against certain groups, and through adopting and promoting mechanisms enhancing the enforcement of anti-discrimination legislation.

Iran will not be able to return to a sustainable development path that ensures a gradual transition to a more efficient and more diversified economy, that reduces its dependence on fossil fuels and generates equitable growth, as long as its government continues to mistreat its minorities and does not refocus its energies and resources on creating an environment that encourages entrepreneurship, that gives voice to people, that ensures substantial progress on poverty alleviation and that signals that equality of opportunity for all is a prerequisite for future prosperity.

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