Measuring the impact of the economic crisis and the period of political division on the Libyan economy

Abstract

The research aimed to measure the impact of the economic blockade crisis and the period of political division on the Libyan economy. It became clear that the period of the economic blockade, which represents the first crisis in the model, had no impact on the economy in the long term. The model also revealed that the period of political and economic division, which represents the second crisis, has had a negative impact on the economy in the long term. This impact is estimated to result in a decline in GDP of approximately 15,677.6 million dinars annually. The results also showed that there is a direct relationship between public spending and gross domestic product, while it was shown that there is a statistically insignificant inverse relationship between the money supply and the gross domestic product. This means that the money supply does not affect economic performance in the short term. It also shows that there is a statistically insignificant direct relationship between the change in the exchange rate and the gross domestic product, while there is an inverse relationship between the change in the exchange rate and the gross domestic product in the first period.