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• Abbas ali Rezaei, Affiliation: Organization of Finance and Economic affairs in Sistan & Balouchestan, Iran.

In this paper, we investigate the relation between entrepreneurship and Added Value Growth in Industrial Sector. For this purpose, we investigated the data related to sistan and Baluchestan Province in the period of 2000 to 2010 by using endogenous growth model. In this model, we set Added Value Growth in Industrial Sector as a function of entrepreneurship, physical capital and labor based on Cobb-Douglas Form. Estimated elasticity of Added Value Growth included 0.60, 0.38, and 0.92 as compared to entrepreneurship, physical capital and labor, respectively. They all have high statistical significances. The results indicate positive effect of entrepreneurship and innovation on the Added Value Growth . In other words, increase of entrepreneurship and innovation coefficient will increase Added Value of Industrial Sector in Sistan and Baluchestan Province. The positive effect of physical capital and labor on the Added Value Growth is another result of this study.

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