A book by Indian-origin author Rajiv Chandrasekaran, a former Washington Post bureau chief in Baghdad, is among six books short-listed for the Samuel Johnson non-fiction prize worth £30,000.
The book, Imperial Life in the Emerald City (Bloomsbury), says that the Coalition Provisional Authority (CPA) in Iraq gave a 24-year-old who had never worked in finance the job of revitalising the Baghdad stock exchange.
The 34-year-old scribe's book also states that Baghdad's new traffic regulations after the CPA took charge were based on the state of Maryland's laws, downloaded by an aide.
Chandrasekaran's book is based on hundreds of interviews and internal documents within the protected Green Zone, inside which the CPA under Paul Bremer tried to rule Iraq in the first year after Saddam Hussein's overthrow.
The book says people with Middle Eastern experience were excluded in favour of Republican Party loyalists.
The New York Times compared the book's chilling effect to the impact of Graham Greene's Vietnam novel The Quiet American.
Among the shortlist is also Georgina Howell's Daughter Of The Desert (Pan Macmillan), which is the biography of Gertrude Bell, the pioneering woman Oxford graduate, mountaineer and archaeologist-spy who travelled from Delhi to the then Mesopotamian frontline, took up the causes of an autonomous Arab state and King Faisal and helped to draw Iraq's borders.
The chair of judges, barrister Helena Kennedy, said: "These are six challenging and extremely well-written books that reflect the ideas and spirit of the society we live in. The list helps to bring an understanding of our world at a crucial time in history."
Other judges are theoretical nuclear physicist and broadcaster Jim Al-Khalili, writer and editor Diana Athill, historian Tristram Hunt and journalist and broadcaster Mark Lawson.
The six titles also include Murder In Amsterdam by Ian Buruma (Atlantic Books), Having It So Good: Britain In The Fifties by Peter Hennessy (Allen Lane), Brainwash by Dominic Streatfeild (Hodder & Stoughton) and The Verneys by Adrian Tinniswood (Jonathan Cape).
The winner will be declared on June 18.