Modified J-Curve Theory, Iran’s Socio-Economic Bottlenecks and the 1979 Fall of the Pahlavi Monarchy

Abstract No one disputes the authenticity of the Islamic Revolution of 1979 that led to the overthrow of the Pahlavi regime and left its footprint in the region and the world at large. This research is an attempt to revisit the Islamic Revolution from an entirely new perspective, looking at the fall of the Pahlavi regime from a combined modified J-Curve Theory of James Davis and Abraham Maslow’s theory of human needs. These combined theories are applied to the socio-economic conditions that lead to the fall of the Pahlavi regime in 1979. The article aims to determine the socioeconomic variants within the general framework and limitations of the J-Curve and to modify the theory to further explain the more ambiguous aspects that fall beyond the socioeconomic components, those defined as the ‘self-actualization needs,’ in what Maslow describes as the basic self-fulfillment aspirations of human beings. The study has several major objectives. Foremost it concentrates on a review of the socioeconomic bottlenecks during the last fifteen years prior to the Islamic Revolution of 1979. Observers regard these as the years of economic and social growth and prosperity. However, these years also led the country to the brink of collapse and revolution. The study seeks to analyze the socio-economic boom and bust in Iran’s development and the rapid decline during the final years prior to the fall of the Pahlavi regime. The attempt is to try and understand the reasons behind the bottlenecks and failures of many of the policies adopted by the regime and to test the validity of the J-Curve theory. The study also looks beyond Davies’ theory of revolution and argues that the J-Curve cannot respond to higher levels of human needs, particularly the self-actualization needs proposed by Maslow. To resolve this issue, we expand the J-Curve theory to include other paradigms as it became necessary to modify the J-Curve to suit the case. Evidence shows that the Shah promised more than he delivered, which led to his ultimate fall because his promise of a ‘Great Civilization’ could not be realized.