Abstract
Purpose: The objective of this study is to delve into the root causes of Lebanon's severe economic crisis. This crisis has been exacerbated by a confluence of factors, including the impact of the COVID-19 pandemic, pre-existing economic difficulties, and the devastating Beirut explosion. The aim is to uncover the fundamental drivers behind the crisis, which encompass issues such as financial mismanagement, governmental shortcomings, excessive debt burdens, intricate financial engineering practices, and political unrest.
Methodology: Employing a quantitative methodology, this research leverages a survey of 178 pertinent stakeholders. The approach encompasses both descriptive analysis and factor analysis. Descriptive statistics were calculated for each variable, providing a comprehensive overview of the perspectives held by the participants. This initial step then guided the subsequent process of factor analysis, which was executed utilizing Principal Component Analysis (PCA) as the technique.
Findings: The results disclose a complex array of factors that have collectively contributed to the current economic turmoil in Lebanon. The presence of a dominant underlying component indicates a strong association between variables related to financial mismanagement, government failures, public debt, financial engineering techniques, and political instability. These factors play a substantial role in driving the crisis, indicating an intricate web of interrelated elements contributing to the country's financial downturn.
Research Limitations/Implications: While this study provides valuable insights into the origins of the crisis, it is important to acknowledge certain limitations. The research primarily relies on quantitative data and stakeholder surveys, which may not capture the entirety of the complex socio-political and economic dynamics at play. Additionally, the study does not delve deeply into potential geopolitical factors that may also be influencing the crisis.
Originality/Value: This research contributes to the existing body of knowledge by offering a data-backed analysis of the Lebanon economic crisis. The identification of specific drivers such as financial mismanagement, governmental failures, and political unrest provides a foundation for targeted policy recommendations. The study emphasizes the importance of implementing prudent fiscal practices, governance reforms, and tailored policies to address the crisis and prevent similar situations in the future.
Publisher
South Florida Publishing LLC
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