Reflection of Economic Shocks on the Diversification of Income Sources in Iraq

Abstract

Iraq's dependence on the commodity and its revenues as a major commodity to finance its operational and investment programs has made its economy vulnerable to the impact of fluctuations or shocks in the world oil markets, whether positive or negative. The global financial crisis caused the oil prices, which recorded a significant decline either by the volume of aggregate demand, or the decline in global prices of the commodity, where the unexpected decline from about 140 dollars / barrel to about $ 40 / barrel, which affected the economy Iraq, which depends on the commodity extraction and export of crude oil to finance its development programs, what the management of its leadership and its policy of water resources to be ambitious. This research analyzes the financial and economic situation of the decline in oil revenues and its relationship to the relevant economic variables within a special perspective of the Iraqi situation and the options open to them to deal efficiently with the crisis and reduce the negative consequences.

Keywords: economic shocks, rent economy, economic inflation, oil prices, diversification of income sources.