Monetary policy and the problem of its independence in Iraq after 2004
DOI:
https://doi.org/10.56967/ejfb2026594Keywords:
monetary policy, monetary policy independence, public revenues, gross domestic product (GDP), public budgetAbstract
This study examined the impact of a rentier economy on the independence of monetary policy in Iraq after 2004, considering Iraq as a rentier state that relies heavily on oil revenues. The study included an analysis of the relationship between the rentier economy and monetary policy, as well as the effects of the rentier economy on the independence of monetary policy. It found that dependence on oil to finance public expenditures leads to a reduction in monetary policy independence.
The results showed that the rentier economy has a significant impact on the independence of monetary policy in Iraq, and that there is a pressing need to diversify the economy and reduce reliance on oil in order to mitigate the risks arising from fluctuations in oil prices, which affect state revenues. Consequently, when the government faces a deficit, it compels the central bank to adopt an expansionary monetary policy to finance this deficit, which in turn undermines monetary policy independence.
The study reached a number of conclusions and recommendations that the researcher believes are aimed at strengthening the independence of monetary policy in rentier states.
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Copyright (c) 2026 حليمة رعد جاسم الدليمي، محمد عبد صالح حسن
This work is licensed under a Creative Commons Attribution 4.0 International License.
This is an Open Access article distributed under the terms of the creative commons attribution (CC BY) 4.0 international license which permits unrestricted use, distribution, and reproduction in any medium or format, and to alter, transform, or build upon the material, including for commercial use, providing the original author is credited.
