Iran's economy did not really change after the 1979 Islamic Revolution. Its economy still relied on exporting oil and gas, and even with the overthrow of Muhammad Reza Shah Pahlavi in 1979, oil revenues stayed relatively stable and only declined as the world's demand of oil declined after the 1973-74 and 1979-80 oil shock. Here is the data compiled by C. Benia, "Global Oil and the Oil Policies of the Islamic Republic." In C. Benia and H. Zanganeh, Modern Capitalism and Islamic Ideology in Iran. London: Macmillan, 1992. Pg. 127.
Oil Revenues, 1977-94
| Year | Revenue ($ billion) |
|---|---|
| 1977-78 | 23 |
| 1978-79 | 21 |
| 1979-80 | 19 |
| 1980-81 | 13 |
| 1981-82 | 12 |
| 1982-83 | 19 |
| 1983-84 | 19 |
| 1984-85 | 12 |
| 1985-86 | 15 |
| 1986-87 | 6 |
| 1987-88 | 10 |
| 1988-89 | 9 |
| 1989-90 | 10 |
| 1990-91 | 17 |
| 1991-92 | 16 |
| 1992-93 | 15 |
| 1993-94 | 19 |
Of course, these numbers mean relatively little if you do not compare it to pre-Revolution era. Since 1954 consortium, Iran became the fourth largest oil producer and the world's second largest oil exporter. Iran's membership in OPEC (Organization of Petroleum Exporting Countries) also largely contributed to Iran's oil producing and exporting share of profits. Iran's oil revenue rose from $34 million in 1954-55 to $5 billion in 1973-74, and further to $20 billion in 1975-76.^1 In any average year, the profits from oil gave the Iranian government more than 60% of its revenues and 70% of its foreign exchange.^2 During this time, it is safe to say Iran became a petroleum state and continued to be one after the Revolution.
Despite Iran's economy mostly relying on oil, the Islamic government had made efforts to diversify its economy. One area is property ownership. In 1981, Ayatollah Khomeini launched an Eight Point Declaration instructing the authorities to respect people's "movable and immovable possessions, including home, stores, workshops, farms, and factories."^3 "Islam" Khomeini proclaimed, "differs sharply from communism. Whereas we respect property, communism advocates the sharing of all things - including wives and homosexuals."^4 The Islamic government placed no ceiling on landownership and distributed more than 850,000 hectares of confiscated agrobusiness land to some 220,000 peasant families in Gurgan, Mazanderan, and Khuzestan. The regime helped these farmers by raising agricultural prices - helping the country become self-sufficient in cereal production; an intensive literacy campaign among the peasantry; and building roads, connecting electricity, water and most importantly health clinics to rural villages.
Endnotes:
F. Fesharaki, "Development of the Iranian Oil Industry." New York: Praeger, 1976. Pg. 132.
E. Abrahamian, "A History of Modern Iran." Cambridge University Press, 2008. Pg. 124.
R. Khomeini, "Eight Point Declaration," Ettela'at, 16 December 1981.
R. Khomeini, "Address to Merchants," Ettela'at, 17 December 1981.