The main objective of this study is to identify factors affecting labor force participation rate of economic and spatial relationships of provinces in Iran. For this purpose, Moran statisticsas univariate and spatial regression (spatial lag model) were used based ondata from the 2011. The results of Moran statisticsas univariate and spatial regression showed that Iran states are cluster status about labor economic participation. Also, the results of spatial lag regression showed that variables such as spatial lag of participation rate, industry's share of total employment, Gini coefficient, dependency ratio and the share of private sector employmentin the states have positive and significant effect on economic participation rate. With respect results, we proposed increasing financial in centives in the labor market, delegating tasksto the private sector and industrial development to create value-added.

Keywords: Economic Participation Rate, Spatial Regression, Spatial Autocorrelation, Moran’s Statistics

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