The impact of changes in oil revenues on public expenditure in Libya

during the period (2000-2024)

Abstract

This study aims to clarify the relationship between oil revenues and public spending by demonstrating the effects of public spending on the Libyan economy during the period (2000-2024). To achieve the study objectives, econometric analysis using the ARDL model was employed. The study results confirmed the existence of cointegration between the study variables. It also demonstrated a positive relationship between the study variables. In other words, a one-unit increase in oil revenues would lead to a 0.23% increase in public spending in the long run. If a shock to oil revenues occurs, the imbalances would be corrected at a rate of 2.28% within a year at a 5% significance level, returning the system to equilibrium.