The Effect of the degree of economic exposure as an indicator of commercial dependence on the rate of economic growth in the Iraqi economy using the vector autoregressive model (VAR)

Abstract

The research aims to measure the impact of the degree of economic exposure on the rate of economic growth in the Iraqi economy for the period from (2000-2020) through the use of modern standard models based on the vector autoregressive (VAR) model. The results showed, through testing the stationarity of the time series, that the dependent variable i.e. the rate of economic growth has settled at the level, and therefore it is integrated from the zero degree, while the variable degree of economic exposure has settled at the first differences, so it is integrated from the first degree. The results indicated that there is an inverse relationship between the degree of economic exposure and the rate of economic growth in the Iraqi economy. It confirmed the validity of the test of the model used and that it is free from the problem (not proving homogeneity of variance) as well as the autocorrelation of the residuals, as the research reached a number of conclusions, the most important of which are: One of the reasons for the fluctuation of the degree of economic exposure in the Iraqi economy during the research period is due to Iraq’s reliance on the strategy of openness. Rapid growth after 2003, which caused a state of chaos due to the policy of commodity dumping, which differs from the policy of closure that prevailed in the nineties. One of the most important recommendations of the research is adopting a trade policy by controlling the import movement to serve the reality of the Iraqi economy, as well as restructuring Iraqi exports and reducing dependence on the oil supplier and its products.