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Oil Prices, Control of Corruption, Governance, and Economic Growth Nexus in Saudi Arabia

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  • Haider Mahmood

    (Department of Finance, College of Business Administration, Prince Sattam Bin Abdulaziz University, 173 Alkharj 11942, Saudi Arabia.)

Abstract

This study examines the impact of control of corruption and the effectiveness of governance on the economic growth in Saudi Arabia using the latest cointegration approach of Pesaran et al. (2001) and Kripfganz and Schneider (2019). We utilize unit root and cointegration tests using a maximum available sample from 1996-2019. The effect of control of corruption is found insignificant on economic growth, and a positive effect of governance is found in the long-run. The study is corroborated that good governance is an appropriate tool for economic growth in the long-run. Moreover, oil prices show a positive effect on economic growth both in the long and short run. It corroborates that the economic growth of Saudi Arabia is oil price dependent. The short-run effects of governance and control of corruption are found insignificant. Hence, a long period with good governance is required to support the economic growth of the Kingdom. So, it is recommended that the quality of governance should be enhanced to support economic growth.

Suggested Citation

  • Haider Mahmood, 2021. "Oil Prices, Control of Corruption, Governance, and Economic Growth Nexus in Saudi Arabia," International Journal of Energy Economics and Policy, Econjournals, vol. 11(4), pages 91-96.
    • Handle: RePEc:eco:journ2:2021-04-12
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    References listed on IDEAS

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    1. Egunjobi T. Adenike, 2013. "An econometric analysis of the impact of Corruption on economic growth in Nigeria," E3 Journal of Business Management and Economics., E3 Journals, vol. 4(3), pages 054-065.
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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. Haider Mahmood & Shafiqul Hassan & Muhammad Tanveer & Maham Furqan, 2022. "Rule of Law, Control of Corruption and CO2 Emissions in Pakistan," International Journal of Energy Economics and Policy, Econjournals, vol. 12(4), pages 72-77, July.
    3. 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.
    4. Sohag, Kazi & Kalina, Irina & Samargandi, Nahla, 2024. "Oil market cyclical shocks and fiscal stance in OPEC+," Energy, Elsevier, vol. 296(C).
    5. 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.
    6. 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.
    7. 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.
    8. 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.

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    More about this item

    Keywords

    Control of corruption; governance; economic growth; oil prices;
    All these keywords.

    JEL classification:

    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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