The Impact of Oil Factor on Azerbaijan Economy

The paper examines the role of oil in the world economy and its impact on Azerbaijan economy. The reciprocal relations between factors in research were carried out by differential model of time series and times series have been checked whether they are unit root (Augmented Dickey-Fuller (ADF), Phillips-Perron (PP) and Kwiatkowski-Phillips-Schmidt-Shin (KPSS) as a methodology of the research. The research focused on the econometric analysis through traditional methods and statistics like EVIEWS 9, GRETL, PASW Statistics. The results confirm that the formation of demand and supply didn't happen in the world market during 15-20 years. The relationships between oil prices and demand and supply prove the novelty of the research. The impact of oil price fluctuations on “economic concept” was high in 2007-2009 and 2014-2016. The practical importance of the article is the employment of the income ‒ generated from “the contract of the century” ‒ for the human development. Keywords: Economic Development, Oil Prices, Econometric Analysis, Functional Dependence, Macroeconomic Indicators JEL Classifications: E31, F31, Q41 DOI: https://doi.org/10.32479/ijeep.800

Analysis of the Main Social Macroeconomic Indicators of the Population During The oil Boom in Azerbaijan

Indicators directly related to the economies of oil−exporting countries, and especially the socio−economic well−being of the population, depend on the resource potential and prices for resources of these countries. The income of the population, their average monthly salary, the average amount of monthly pensions, the average amount of old−age pensions, the average amount of disability pensions, the amount of pensions for the loss of the head of the family form the basis of the state of financial well−being. Taking them as a basis, we completed the goal of our research by constructing models that determine the dependence of the main indicators of the socio−economic and, of course, material well−being of the population of Azerbaijan on world oil prices. The study covers the years 1997−2022. The  and  models are adapted to determine long−term and short−term levels of these indicators, taking into account world oil prices. According to the results, a high level of co−integration relationship with world oil prices and socio−economic indicators of the population is noted. This has also been proven in the short term. Thus, the alternative , , , and models used to validate these results further demonstrated the importance of these interactions. Moreover, the study also conducted a combined Bayer−Hank co−integration test. But the results turned out to be somewhat different. The results of this study can be taken into account to one degree or another in the socio−economic policy of the state in Azerbaijan

The Impact of Oil Exports on Imports of Agricultural Machinery and Equipment

The influence of the main export product on the main import product is the focus of any country. In this regard, since oil and oil products are the main export commodity of Azerbaijan, their impact on the import of machinery and equipment necessary for the development of the agricultural and agro −processing industries, which are the main imported products, was chosen as the subject of study. The purpose of the article was to assess the impact of the export of oil and oil products on the import of machinery and equipment necessary for the development of the agricultural sector and the agro −processing industry. The study used data for the period from 1999 to 2020. ARDL and ECM methods were applied and compared with FMOLS, DOLS and CCR as a validation. During the study, 9 hypotheses were proposed. All hypotheses have been proven to some extent. The results of the study show that, like all industries, the agricultural sector depends on the oil factor. Thus, the export of oil to the republic has a positive effect on imports and, of course, on the imports of many machineries and equipment necessary for the development of the agricultural sector, especially agricultural machinery for tillage and harvesting, equipment for the food industry and equipment for processing agricultural products. The overall result of the research was a recommendation to further acceleration of work aimed at diversifying the economy and developing the non −oil sector, similar to the results of other similar studies (researches investigating resource −exporting economies)