Design and Validation of a System Dynamics Model for Attracting and Leveraging Industrial Elites in Iran’s Industrial Production System

Document Type : Research Article

Authors

Ali Shoobi ¹

Rouhollah Bagheri ²

Jalal Haghighatmonfared ¹

¹ Department of Management, Central Tehran Branch, Islamic Azad University, Tehran, Iran

² Department of Management, Ferdowsi University of Mashhad, Mashhad, Iran

10.22067/jstinp.2026.96998.1194

Abstract

This paper designs and validates a system dynamics model to explain the mechanisms of attracting, retaining, and leveraging industrial elites in Iran’s industrial production system. Given the strategic role of industrial elites in developing a knowledge-based economy and improving industrial competitiveness, a range of policies and institutions have been established in recent years; however, a meaningful gap remains between the emerging capacity of industrial elites and their realised impact on industrial production. Based on the literature on human capital, elite migration, national innovation systems, and science and technology policy and relevant upstream policy documents, key variables and feedback relationships across higher education, elite support, industrial R&D units, industrial knowledge-based companies, the elite labour market, and the policy/institutional environment were identified and formalised as causal-loop and stock and flow structures and implemented in Vensim. Using official time-series data for 2012–2021 (1391–1400), the model was calibrated and evaluated using structural tests (e.g., boundary adequacy and dimensional consistency) and behavioural tests (historical behaviour reproduction, extreme-condition tests, and sensitivity tests). The results indicate that the proposed model reproduces the historical trends of key variables with acceptable accuracy and exhibits robust behaviour under reasonable parameter changes. The model can serve as a policy laboratory for ex ante evaluation of interventions to increase industrial absorption capacity, strengthen industrial R&D, and reduce persistent elite outflows.

Keywords

">Keywords System dynamics

Industrial elites

Industrial R&‌‌‌D

Industrial knowledge-based companies

Elite migration

---

References

Amsden, A. H., DiCaprio, A. and Robinson, J. A. eds., 2012. The role of elites in economic development. Oxford: Oxford University Press. https://doi.org/10.1093/acprof:oso/9780199659036.001.0001.

Barlas, Y., 1996. Formal aspects of model validity and validation in system dynamics, System Dynamics Review, 12(3), pp. 183–210. https://doi.org/10.1002/(SICI)1099-1727(199623)12:3<183::AID-SDR103>3.0.CO;2-4.

Forrester, J. W., 1961. Industrial dynamics. Cambridge, MA: MIT Press.

Freeman, C., 1987. Technology policy and economic performance: Lessons from Japan. London: Pinter.

Lundvall, B.-Å., 1992. National systems of innovation: Towards a theory of innovation and interactive learning. London: Pinter.

Mills, C. W., 1956. The power elite. Oxford: Oxford University Press.

Moghimi, M. and Memarzadeh Tehran, G., 2021. Higher education processes and elite selection and the issue of migration: Exploring the elite crisis and the role of higher education in Iran, Educational Policy Quarterly, 13(4), pp. 23–41. [In Persian].

Moghimi, S. M., 2018. ‘Investigating the impact of talent management in employing and attracting elites and its effects on reducing elite migration in Iran’, Business Management (Innovative Business Management), 10(39). [In Persian].

Naqi Pourfar, A., 2013. ‘Explaining an Islamic meritocracy model to address meritocracy challenges in Iran’s public organisations’, Journal of Public Administration, 5(3), pp. 53–80. [In Persian].

Nelson, R. R., 1993. National innovation systems: A comparative analysis. New York: Oxford University Press.

Pareto, V., 1968. The rise and fall of elites: An application of theoretical sociology. Bedminster Press.

Safaie, N., Chakmehchi Khiavi, F. and Shahsavar, M. S., 2023. ‘Examining the emigration of elites from Iran: A system dynamics approach’, Journal of Systems Thinking in Practice, 2(4), pp. 17–32. https://doi.org/10.22067/jstinp.2023.85830.1083.

Shahabadi, A., Salehi, M. and Hosseinidoust, S. E., 2020. ‘The impact of competitiveness on brain drain: GMM panel approach’, Journal of the Knowledge Economy, 11, pp. 558–573. https://doi.org/10.1007/s13132-018-0556-7.

Statistical Center of Iran, 2022. Industrial workshops with R&D activities: Annual statistics (2012–2021). Tehran: Statistical Center of Iran.

Sterman, J. D., 2000. Business dynamics: Systems thinking and modeling for a complex world. New York, NY: McGraw-Hill.