Measuring and analyzing the impact of crude oil price shocks on human capital in Iraq for the period (1970-2021)

Abstract

The research aims to analyze the relationship between oil prices and human capital, as well as measuring and analyzing the impact of crude oil prices on human capital in Iraq for the period (1970-2021) using the ARDL model, and estimating the impact of a shock in the Iraqi economy on the relationship between crude oil prices and capital. human subjects in Iraq using the DYNARDL model. The research found that there is a long-term inverse relationship between crude oil prices in the international market and human capital in Iraq; When the price of crude oil (LNOilP) increases by (1%), it will lead to a decrease in human capital (LNHC) by (0.41%), and the opposite happens in the case of a decrease. In the long term, the forces of automatic correction in the economy will restore balance by about (1.29%) annually. The research also concluded that in the event of a shock in the Iraqi economy, the impact of crude oil prices on human capital will differ from what it was before the shock, as the shock will reduce the effectiveness of crude oil prices towards human capital by about (95%) from what it was before. shock When the price of crude oil (LNOilP) increases by (1%), it will lead to a decrease in human capital (LNHC) by (0.02%), and the opposite happens in the case of a decrease. The research recommends the need to make sources of funding for spending on education, health and the environment from non-oil revenues in order to avoid shocks in human capital as a result of shocks in crude oil prices in the international market.