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Oil Price and Economic Growth Nexus in Saudi Arabia: Asymmetry Analysis

Author

Listed:
  • Haider Mahmood

    (Department of Finance, College of Business Administration, Prince Sattam Bin Abdulaziz University, Alkharj, Saudi Arabia,)

  • Muntasir Murshed

    (School of Business and Economics, North South University, Bangldesh.)

Abstract

Oil Price (OP) and revenue play a significant contribution to the income of oil producers. Saudi income is majorly sourced from the oil sector. Therefore, it is very important to see the influence of OP on income. Particularly, testing asymmetry is necessary to see whether increasing OP has the same effect on income or not as of decreasing OP. This present research cares about this issue using nonlinear cointegration techniques. We found the symmetrical effect of OP on income in the long-run and asymmetrical effects in the short-run. Moreover, increasing and decreasing OP have equal pleasant and harmful effects on income. Moreover, increasing OP has a more pleasant effect than that of decreasing OP harmful effects on income in the short-run.

Suggested Citation

  • Haider Mahmood & Muntasir Murshed, 2021. "Oil Price and Economic Growth Nexus in Saudi Arabia: Asymmetry Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 11(1), pages 29-33.
    • Handle: RePEc:eco:journ2:2021-01-5
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    References listed on IDEAS

    as
    1. Tarek Tawfik Yousef Alkhateeb & Haider Mahmood, 2020. "Oil Price and Capital Formation Nexus in GCC Countries: Asymmetry Analyses," International Journal of Energy Economics and Policy, Econjournals, vol. 10(6), pages 146-151.
    2. Abdulaziz Hamad Algaeed, 2018. "The Oil Price Volatility and a Revisited Saudi Import Demand Function: An Empirical Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 8(6), pages 59-69.
    3. Tarek Tawfik Yousef Alkhateeb & Haider Mahmood, 2020. "Oil Price and Energy Depletion Nexus in GCC Countries: Asymmetry Analyses," Energies, MDPI, vol. 13(12), pages 1-13, June.
    4. Tarek Tawfik Yousef Alkhateeb & Haider Mahmood & Zafar Ahmad Sultan & Nawaz Ahmad, 2017. "Oil Price and Employment Nexus in Saudi Arabia," International Journal of Energy Economics and Policy, Econjournals, vol. 7(3), pages 277-281.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Ghazala Aziz & Suleman Sarwar, 2023. "Empirical Evidence of Environmental Technologies, Renewable Energy and Tourism to Minimize the Environmental Damages: Implication of Advanced Panel Analysis," IJERPH, MDPI, vol. 20(6), pages 1-20, March.
    2. Suleman Sarwar & Dalia Streimikiene & Rida Waheed & Ashwag Dignah & Asta Mikalauskiene, 2021. "Does the Vision 2030 and Value Added Tax Leads to Sustainable Economic Growth: The Case of Saudi Arabia?," Sustainability, MDPI, vol. 13(19), pages 1-20, October.
    3. Hicham Ayad & Ousama Ben-Salha & Miloud Ouafi, 2023. "Do oil prices predict the exchange rate in Algeria? Time, frequency, and time‐varying Granger causality analysis," Economic Change and Restructuring, Springer, vol. 56(5), pages 3545-3566, October.
    4. Nadia Yusuf & Vivian Nasrulddin, 2024. "Significance of International Trade and National GDP as Two Integral Components of Sustainable Economic Development in Saudi Arabia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2298-2317, March.
    5. Mahmood, Haider & Tanveer, Muhamamd & Ahmad, Abdul-Rahim & Furqan, Maham, 2021. "Rule of Law and Control of Corruption in Managing CO2 Emissions Issue in Pakistan," MPRA Paper 109250, University Library of Munich, Germany.
    6. Haider Mahmood, 2021. "Oil Price and Industrial Growth in Saudi Arabia: Sectoral and Asymmetry Analyses," International Journal of Energy Economics and Policy, Econjournals, vol. 11(3), pages 7-13.
    7. Joseph David, 2024. "The role of corruption in the oil price–growth relationship: Insights from oil-rich economies," Economic Change and Restructuring, Springer, vol. 57(6), pages 1-32, December.
    8. Tomader Elhassan, 2021. "Impact of Oil Price Fluctuations on Economic Growth in Saudi Arabia: Evidence from a Nonlinear ARDL Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 11(5), pages 579-585.
    9. Sohag, Kazi & Kalina, Irina & Samargandi, Nahla, 2024. "Oil market cyclical shocks and fiscal stance in OPEC+," Energy, Elsevier, vol. 296(C).

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    More about this item

    Keywords

    Asymmetry; Oil price; Economic growth; cointegration;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General

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