FINANCE-GROWTH NEXUS AND ADOPTION OF ARTIFICIAL INTELLIGENCE IN AZERBAIJAN

Nazrin Akhundzada, Amiran Gahramanov · AGORA INTERNATIONAL JOURNAL OF ECONOMICAL SCIENCES · 30 Jun 2026

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Will AI actually boost productivity and growth?

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Abstract

This article investigates the relationship between financial development and economic growth in Azerbaijan within 2000–2024 period. Findings from the Autoregressive Distributed Lag (ARDL) Bounds Test reveal a significant long-term cointegration among financial development, physical capital investments, and economic growth, suggesting that access to finance for the private sector is a strong accelerator for economic growth. While domestic credit to the private sector shows a weak positive short-run impact, its long-run impact is negative. The divergence between the positive impact of physical capital and the negative impact of credit expansion in the long run implies that even though physical investments enhance productivity, the financial markets might be inefficient in the allocation of resources by moving funds toward non-productive sectors and creating a misallocation constraint on economic growth. To improve the efficiency in financial markets, digitalisation of financial services and integration of AI-based models were evaluated as key strategic priorities. This study also employs a SWOT analysis to explore opportunities and challenges for successful adoption of AI.

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Academic journal. Published in an academic journal — typically peer-reviewed before publication, though indexing alone doesn't guarantee review depth.

Published: 2026 (4 months ago)
Citations: 0 (OpenAlex)

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FINANCE-GROWTH NEXUS AND ADOPTION OF ARTIFICIAL INTELLIGENCE IN AZERBAIJAN

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