Benchmarking South Korea’s Labor Productivity and SME Support: A Policy Approach to Economic Growth in Iran

Document Type : Original Article

Authors

1 Ph.D. Candidate in Public Administration, Department of Management, Faculty of Management and Economics, Lorestan University, Khorramabad, Iran.

2 M.A. in Business Administration, Islamic Azad University, Arak, Iran.

10.22098/cpa.2025.17420.1070

Abstract

Context and Purpose: Given the growing importance of small and medium-sized enterprises (SMEs) in driving economic growth, this study adopts a comparative approach to examine the nonlinear and interactive effects of human resource productivity and financial support provided to these enterprises in the Republic of Korea. The aim is to extract a suitable policy model for developing countries like Iran, which face similar challenges in productivity enhancement and financial allocation.
Methodology: This is a quantitative study based on secondary data from South Korea’s macroeconomic indicators during the period 2001 to 2024. Using the Central Composite Design (CCD) and Response Surface Methodology (RSM), a second-order regression model was developed to estimate the linear, quadratic, and interaction effects of the variables under investigation.
Findings: The results revealed that the growth rate of human resource productivity has a stronger and more positive impact on economic growth compared to the share of financial facilities. Both variables, however, exhibit diminishing returns beyond their optimal thresholds. Moreover, a synergistic interaction between the two significantly increased the maximum economic growth rate to approximately 4.8 percent. From a comparative perspective, South Korea has effectively managed these components through specialized institutional frameworks, skill-based investments, and intelligent regulation of banking credit policies.
Conclusion: Drawing on South Korea’s successful experience and accounting for institutional, cultural, and economic differences, Iranian policymakers can enhance the productivity of human resources and the effectiveness of financial support mechanisms—thereby promoting sustainable economic growth—by establishing an independent coordinating institution, optimizing credit ceilings, and expanding vocational education and training programs.

Keywords

Comparative Studies in Public Administration
Volume 3, Issue 2
September 2025

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History

  • Receive Date: 13 May 2025
  • Revise Date: 04 September 2025
  • Accept Date: 14 September 2025

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