Investigating the Impact of Government Size on the Productivity of Labor and Capital Factors in the OPEC Islamic Countries

The role of government in influencing economic activity is undeniable, although it varies widely in economic systems. Productivity is one of the variables affecting government interventions and it greatly affects the overall competitiveness of the economy. This    study investigates the effect of government size on labor and capital factor productivity  in Islamic countries of OPEC during 2018 -2000 using panel data method in both linear and nonlinear methods in Cobb Douglas and Translog mode. So, two models were estimated. In nonlinear  models ,  it shows that labor market and capital productivity   are not moderated by two variables of size of government and capital . In both models, the size of the government has a negative effect on labor productivity and capital markets.  comparing the results of the two   models,  it show that the linear model is preferable to nonlinear and among the linear model states of the Cobb Douglas function based on the significance of the model coefficients and the likelihood and chi-square test statistic is more advantageous. Therefore, considering the estimation results on the influence of state size and other variables, can be it suggested that It can be done by providing facilities to the private sector and facilitating the business climate   , reduce  government  size, it  increases the productivity of the private sector.