MEASURING AND ANALYZING THE IMPACT OF CRUDE OIL PRICES ON THE POVERTY RATE IN IRAQ FOR THE PERIOD (2004 - 2021)

Abstract

The research aims to analyze the relationship between oil prices and the poverty rate, as well as to estimate the impact of crude oil prices on the poverty rate in Iraq for the period (2004 - 2021) using the NARDL model, the research also aims to find out the extent of the impact of a shock in oil prices on the poverty rate in Iraq, the research found that there is a long-term, non-linear inverse relationship between crude oil prices and the poverty rate in Iraq, as an increase in crude oil prices by (1%) will lead to a decrease in the poverty rate by (0.32%), while a decrease in crude oil prices by (1%) will lead to an increase in the poverty rate by (0.24%), and if a shock occurs in crude oil prices, it will lead to a decrease in the poverty rate in Iraq by (2.5%); However, after one semester of the shock (three months), the poverty rate will increase to (0.2%) and reach its peak in the second semester (six months) at (0.4%). However, the poverty rate in the third semester begins to decline until it reaches the level in the fifth semester to the original balance before the shock occurred, and the poverty rate decreases since the sixth semester (a year and a half) after the shock to below the original equilibrium level before the shock by (0.1%), which continues for the long term, the research recommends to adopt a national strategy to combat poverty in the country that relies on sources of income away from the effects of oil price fluctuations on the global market.