Iranian Institute of Industrial Engineering Journal of Industrial and Systems Engineering 1735-8272 18 1 2026 01 01 Productivity Analysis in the Banking System with a Short-Run and Long-Run Causality Approach 16 27 244405 EN Ahoo Famil Bakhtiyari Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Kambiz Hojabrkiani Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Abbas Memarnegad Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Farhad Ghaffari Department of Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran. Journal Article 2025 07 13 Enhancing the productivity of financial markets plays a key role in the economic development of countries. Considering the bank-oriented nature of the financial systems in most nations, including Iran, identifying effective methods for measuring and improving productivity levels in banks is of great importance. Accordingly, the present study aims to examine the short-run and long-run causal relationships among capital adequacy, labor force, and total factor productivity (TFP) within a selected sample of ten banks listed on the Tehran Stock Exchange over the period 2010–2017 (1389–1396 in the Iranian calendar). The research results, obtained using the Dynamic Ordinary Least Squares (DOLS), the Vector Error Correction Model (VECM), and the Wald test, reveal a one-way causal relationship from capital adequacy to total factor productivity in the short run. In the long run, however, bidirectional and statistically significant positive relationships are found between labor force and capital adequacy with total factor productivity. Moreover, the error correction term, which represents the speed of short-run adjustment toward long-run equilibrium, is also evaluated. https://www.jise.ir/article_244405_dd4c6e635f2e4062fa89c334820ee96d.pdf