In brief. In the 1970s Iran's oil revenue rose sharply, funding rapid spending and large public celebrations. Economic strain, political closure and wide criticism of the state led to mass protests in 1978 and to the end of the monarchy in early 1979.
By the early 1970s, the shah’s government was confident. The economy was growing, oil income was rising, and Iran was an important ally of the West in the Cold War. In 1971 the shah marked what he called 2,500 years of Persian monarchy with a huge celebration at Persepolis and nearby Pasargadae, attended by kings, presidents and other leaders from around the world.
The 1971 celebrations took place at Persepolis and Pasargadae in October and were attended by many foreign guests. The scale and the cost were widely criticised, inside Iran as well as abroad.
The boom
In 1973–74 the price of oil rose sharply, and Iran’s income grew several times over. The government launched ambitious plans for industry, infrastructure, education and the army. Cities grew fast, and incomes rose for many people. But spending outran the economy’s ability to absorb it. Inflation increased, housing was short in the cities, and corruption and favouritism became a common complaint. In 1977 the government tried to cool the economy with measures that angered merchants and others.
Many economists and historians argue that the boom raised expectations and created resentments at the same time: a large new middle class and a growing urban poor both felt that they did not share the benefits fairly.
Politics without space
In 1975 the shah created a single party, Rastakhiz, and said that people who did not join it could leave the country. The press was controlled, and the secret police faced criticism from international human rights organisations, an issue described in our article on critical perspectives. Opposition groups of very different kinds existed, from liberal and left-wing to religious ones, but all had limited room to act in public.
Pressure and protest
In 1977 the American government under President Carter spoke more about human rights, and writers and lawyers in Iran published open letters. In 1978 demonstrations grew in cities across the country, with mourning ceremonies that fed each new round of protest. The shah tried both concessions and repression. In January 1979 he left Iran, and the monarchy ended weeks later.
Historians still argue about why a regime with large resources fell so quickly: whether the main cause was economic strain, political closure, religious mobilisation, mistakes by the shah, foreign policy, or a combination.
What the decade left
The 1970s are remembered in very different ways: as a time of growth and international prestige, as a time of waste and repression, or as both. Our other articles on this period try to give each of these views its evidence.
Notes and sources
- Ervand Abrahamian, Iran Between Two Revolutions (Princeton University Press, 1982).
- Abbas Amanat, Iran: A Modern History (Yale University Press, 2017).
- Abbas Milani, The Shah (Palgrave Macmillan, 2011).
- Nikki R. Keddie, Modern Iran: Roots and Results of Revolution (Yale University Press, 2003).
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