Rentier Economy Dependence and Economic Policies in Iraq: An Econometric Analysis of the Determinants of Economic Reform (2004–2024)
Year: 2026
Type: article
Abstract: This study examines the impact of rentier dependence on the effectiveness of economic policies in Iraq during the period 2004–2024 by analyzing the relationship between several macroeconomic variables—such as oil revenues, government spending, inflation, money supply, and exchange rates—and their influence on economic performance. The study employs a descriptive-analytical approach and utilizes econometric models (ARDL and NARDL) to measure short- and long-term relationships. The results revealed a long-run equilibrium relationship among the variables under study, alongside the Iraqi economy's continued heavy reliance on oil revenues—a dependency that renders it vulnerable to fluctuations in global oil prices. It was also found that negative shocks to oil revenues have a greater impact on economic growth than positive shocks, whereas the impact of government spending remained limited due to the predominance of current expenditure over investment expenditure. Furthermore, the results indicated that the money supply positively influences economic activity, while the effects of inflation and the exchange rate were relatively weak. The study recommends adopting structural reforms to diversify revenue sources, boost non-oil sectors, and improve the efficiency of public resource management in order to achieve sustainable economic growth in Iraq.
Institutions: University of Wasit, University of Zakho, Nawroz University
Language: English
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W7202200569