Article history: Received October 28, 2013 Received in revised format 25 November 2013 Accepted 29 January 2014 Available online February 4 2014 This research analyzes the effects of financial deepening as well as repression on industrial development in Iran. Using some time series data, the proposed study applies the method originally introduced by Johansen and Juselius (1990) [Johansen, S., & Juselius, K. (1990). Maximum likelihood estimation and inference on cointegration—with applications to the demand for money. Oxford Bulletin of Economics and statistics, 52(2), 169-210.] to measure the effects of these two factors on market development over the period 1970-2011. The results indicate that as the bank deposit increases, we may expect an increase on financial deepening and market development. On the other hand, as inflation increases, we could easily verify market repression and a reduction on market development. In addition, when there was an increase on loans dedicated to private sector, there was an increase on market development. Finally, there were some evidences to believe that currency devaluation could hurt market development by increasing the price of raw materials and market uncertainty. © 2014 Growing Science Ltd. All rights reserved.