Changes in the structure of output by the evolution of aggregate demand components – Iraq Case Study.

Thesis Submitted To

 The Council of The Faculty of Administration and Economics – University of Karbala

It Is Part of The Requirements For Obtining A Master’s Degree In Economic Sciences

Submitted By

Mariam H. Nassir Alkindy

Supervised By

Prof. Dr. Mahdi S. Ghilan Aljubouri

Abstract

    The Iraqi economy is characterized by the availability of the available ingredients and capabilities, in order to build a real economy that possesses strong foundations that are qualified to pursue the policy of economic diversification.  GDP, and this is reflected in turn on the competitiveness and weakness of other productive sectors. This is also reflected in irrational economic policies that are marred by a lack of planning with a future vision, benefiting from previous economic experiences and conditions, in addition to the lack of solid scientific foundations for these policies.  And that the main problem of the study is centered on the inability of the Iraqi economy to address the structural imbalances of the gross domestic product through the rentier economy, which depends on oil revenues, which affects economic growth.

    The study analyzed the relationship between the components of aggregate demand and GDP for the period (2000-2021), and the Iraqi economy as a spatial case study, by analyzing the impact of each of the variables of aggregate demand on the gross domestic product in Iraq, whether short-term or long-term effects, add  In addition, knowing the dynamic effects and the long-term co-integration relationship between them using the advanced standard analysis method (ARDL).

    The weakness of the interdependence between the economic sectors of the rentier of the Iraqi economy on the one hand, and the weakness of the impact of the components of aggregate demand, except for private consumption spending, on the revitalization and diversification of the economy on the other hand, so the study recommended restructuring the Iraqi economy by pursuing the policy of economic diversification and moving the components of aggregate demand, such as government spending and government investment towards  Productive sectors to change the structure of output and also as sectors driving economic growth in Iraq.

     As a result of the foregoing, any real treatment of the structural imbalance in the Iraqi economy requires the development of an economic policy according to scientific foundations and economic modeling.