The Impact of Investment in Technological Infrastructure on Economic Growth in Iraq for the Period 2005–2025
Abstract
This research explores the interdependence between technological infrastructure investment and the non-oil economic growth in the state of Iraq from 2005 to 2025. Using an Autoregressive Distributed Lag (ARDL) bounds testing approach, annual time-series data is taken from official Iraqi and international data sources to differentiate between short-run adjustments and long-run equilibrium effects. The results show that from a short run point of view, technological investment has a positive and statistically significant effect on non-oil growth (β = 0.00028, p < 0.001), while in the long run, the relationship is only marginally significant (p = 0.055) and structural constraints appear to moderate the long-run impacts. All diagnostic tests are consistent with model validity, and there is no evidence of serial correlation, heteroskedasticity or residual non-normality. Additional bivariate analysis confirms strong positive relationships between technology investment and digital efficiency, volume of electronic payments, financial inclusion and government automation, which align with the hypothesized channels. The results show that although digital capital deployment has been a trigger for diversification in the short-term, the process needs complementary institutional reform, human capital development, and regulatory modernization for a sustainable growth. This study adds much needed empirical research to the policy body of knowledge for hydrocarbon economies seeking to pursue development paths that are non-oil-dependent, inclusive and resilient.
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References
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