Economic Growth
Ahmed falih Abd Alhasan Alsaedi; Narges Salehnia; Mohammad Taher Ahmadi Shadmehri
Abstract
The aim of this study is to compare the potential asymmetric effects of crude oil price fluctuations on real GDP growth in two neighboring countries (Iran and Iraq). In this study, deviation from the average is considered as crude oil price fluctuations, and to estimate the long-term and short-term asymmetric ...
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The aim of this study is to compare the potential asymmetric effects of crude oil price fluctuations on real GDP growth in two neighboring countries (Iran and Iraq). In this study, deviation from the average is considered as crude oil price fluctuations, and to estimate the long-term and short-term asymmetric effects of crude oil price fluctuations on the economic growth of two oil-exporting countries (Iran and Iraq) with two models, one and two, the approach of the autoregressive model with non-linear distribution Lags (NARDL) and the annual data of 1990-2022 were used. Asymmetric analysis provides significant results regarding the difference in economic growth responses to positive and negative crude oil price shocks. In the case of Iran, the response of real GDP to a positive oil shock is larger than to a negative oil shock in the long run. The results showed that although the increase in the price of oil in the short term increases the economic growth of Iran, the increase in the price of oil in the long term reduces the real growth of Iran. In addition, the negative shock of oil in the short and long term will reduce Iran's economic growth. On the other hand, the positive oil shock increases Iraq's economic growth in the short term, while it does not have a significant effect on Iraq's real GDP in the long term. The empirical findings of this study provide important policy implications for policymakers and officials in Iran and Iraq regarding sustainable economic growth.
