People-Centered Economy (Part Six)

 Amirhossein Khodaei, Researcher

People-Centered Economy (10)

People-Centered Economy; A Ladder for Reducing Deprived Deciles and Strengthening Public Participation

Iran’s economy has for years oscillated between two main approaches: a state-led economy and privatization.
The state-led model, with power and ownership concentrated in government hands, aimed at control, stability, and supporting vulnerable groups, but in practice became entangled in heavy bureaucracy, inefficiency, and structural corruption.
Privatization, launched to enhance efficiency and competitiveness, in many cases resulted in the concentration of wealth among specific groups, leaving ordinary people with little share.

In such an environment, popularizing the economy emerges as a third and complementary approach—one that transforms people from mere consumers into investors, decision-makers, and real partners in the economy.

The Concept of the Participation Ladder

The participation ladder illustrates the gradual path toward a people-centered economy.
The initial steps involve informing and raising public awareness about economic opportunities.
The middle steps enable expression of opinions, participation in decision-making, and collective investment.
At higher steps, people become real owners of parts of projects and benefit from sustainable profitability.

Climbing this ladder leads to a reduction in deprived deciles, as people move from passive consumption to active economic participation and value creation.

Types of Participatory Funds and Their Functions

Popularizing the economy is not possible without efficient financial instruments. Funds act as bridges connecting people to economic projects:

• Employment-Creation Funds: Pooling small public savings to create sustainable local jobs, reduce unemployment, and increase household incomes.

• Project Funds: Public participation in oil and gas joint fields, reducing raw material exports through value-added production, derivative industries, small-scale manufacturing, import substitution, and infrastructure projects such as power plants, housing, and urban development.

• Research and Technology Funds:

  • Licenses for establishment by schools, universities, and research institutions, with profit-sharing for educators, researchers, students, and staff to foster creativity and transformation.

  • Linking small and large industries through cooperation agreements.

  • Channeling public capital toward innovation, commercialization of ideas, and knowledge-based companies with professional risk management.

• Investment Funds: Enabling broad participation—especially middle-income groups and retirees with subsidies—in productive investment under professional management and controlled risk.

Further discussion on diverse fund capacities will follow in later editions.

Facilitating Participation in Quick-Return Projects

Designing simple and transparent mechanisms to enable public participation in small yet impactful projects without legal or administrative complexity.

Cooperative Foundations: The Link Between People and the Economy

Establishing cooperative foundations in public and private institutions serves as a key tool for popularizing the economy.

• Legal Mandates: Requiring public bodies and large private companies to offer part of their activities through cooperative foundations, enabling employees and citizens to share profits and losses.

• Participation Facilitation: Managing various funds under transparent and professional systems to reduce investment risks.

• Promoting Cooperative Culture: Public education, trust-building, and strengthening social belonging.

Targeted Prioritization

With special support for population growth initiatives, retirees, young couples, uninsured families, workers, and lower-income deciles, vulnerable groups can participate in low-risk, fast-yield projects and gain sustainable income.

Cultural Development: The Foundation of Success

No people-centered policy succeeds without cultural groundwork.
Economic participation and collective investment must be understood as securing society’s future—not merely individual profit.
Media, universities, educational institutions, and influential elites play a decisive role in institutionalizing this mindset.

Empowering Small Trade and Popularizing Commerce

Supporting small businesses, local vendors, and micro-producers through removing unnecessary intermediaries, market access, affordable financing, and marketing education.
Direct-sales platforms, local markets, short supply chains, and distribution cooperatives are key tools.

Structural and Non-Structural Barriers

Heavy bureaucracy, complex laws, lack of transparency, concentration of economic power, and public distrust are major internal obstacles.
Rent-seeking networks and economic mafias, benefiting from monopolies and privileged access, strongly oppose people’s entry into the economy.

Solutions to Overcome Barriers

• Transparency and Open Data: Public disclosure of contracts and projects.

• Digitalization: Reducing corruption by limiting direct contact with rent-seeking structures.

• Strengthening Competition and Cooperatives: Breaking monopolies.

• Public and Media Oversight: A key anti-rent mechanism.

Engaging Powerful Networks

Conditioning their activities on public participation, mandatory offering of projects in public funds, supporting small industries, transferring knowledge and distribution networks, and transforming large players into drivers of people-based value chains.

Methods of Public Advocacy

Through professional associations, media engagement, administrative courts, dialogue with officials and representatives, and advocacy campaigns, people can demand transparency and accountability—an essential rung of the participation ladder.

Successful Domestic and International Models

Domestic: Local micro-funds, rural cooperatives, Justice Shares, research and technology funds, local markets, cooperative foundations.
International: Microfinance in India, large agricultural cooperatives in Europe, public pension funds in Scandinavia, and South Korea’s technology ecosystem.

Comparative Analysis

Global experiences show broader and more structured use of microfinance, pension funds, and participatory institutions. Iran can localize these models.

People-Based Financing Methods

Pooling small savings, crowdfunding small businesses, leveraging pension funds and household savings, directing subsidies toward productive investment, and proportional public ownership in national projects.

Knowledge-Based Economy and New Technologies

IT, AI, advanced technologies, mining, oil, data, and informatics provide unparalleled opportunities for people-centered growth, high value creation, and transparency.

Major Iranian Experience: Justice Shares

Around 49 million Iranians are shareholders, demonstrating massive public ownership potential, though full implementation remains incomplete.
Investment fund participation has grown by 179% over seven years, reflecting rising public engagement.

Three-Phase Roadmap

• Short-Term (1–2 years): Completing Justice Shares reform, expanding micro-funds, financial literacy campaigns.

• Mid-Term (3–5 years): Expanding cooperative foundations, strengthening project and technology funds, pilot programs.

• Long-Term (5–10 years): Institutionalizing public ownership culture, integrating with regional and global markets, digital transparency, and embedding this approach in national budgeting.

Proposal: Institutional Accreditation for Popularizing the Economy

Establishing measurable online indicators, legal enforcement, risk management, transparency, and public participation as conditions for institutional credibility.

Conclusion

When combined with participation ladders, funds, cooperatives, cultural development, empowerment of vulnerable groups, transparency, advocacy, and modern technologies, popularizing the economy can become a practical and sustainable strategy for reducing inequality and transforming development into a broad social movement.

Final Reflection:
Wise reasoning leads to continuous alignment with truth.