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Does Foreign Direct Investment Affect Industrial Workers? Evidence from Kingdom of Saudi Arabia

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  • Khodeir, Aliaa
  • AL Nuwaiser, Sarah

Abstract

This paper aims at determining the essential variables that affect the employment of industrial workers in the Kingdom of Saudi Arabia (KSA) by focusing on the role of foreign direct investment as an indicator of financial openness. By using the methodology of the autoregressive distributed lag (ADRL) to identify the impacts on both the short and long run during the period (1990-2014), it turns out that foreign direct investment does not have a positive impact on the employment of industrial workers which is contrary to the hypothesis of the study. The empirical results have shown that there is a positive and significant impact of both exports and inflation on industrial employment on the long run only. Thus, the current paper is important in the decision making concerning investment and labor market in KSA.

Suggested Citation

  • Khodeir, Aliaa & AL Nuwaiser, Sarah, 2016. "Does Foreign Direct Investment Affect Industrial Workers? Evidence from Kingdom of Saudi Arabia," MPRA Paper 103510, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:103510
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    References listed on IDEAS

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    2. World Bank, 2015. "World Development Indicators 2015," World Bank Publications - Books, The World Bank Group, number 21634.
    3. T.K. Jayaraman & Baljeet Singh, 2007. "Foreign Direct Investment and Employment Creation in Pacific Island Countries: An Empirical Study of Fiji," Working Papers 3507, Asia-Pacific Research and Training Network on Trade (ARTNeT), an initiative of UNESCAP and IDRC, Canada..
    4. Driffield, Nigel & Taylor, Karl, 2000. "FDI and the Labour Market: A Review of the Evidence and Policy Implications," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 16(3), pages 90-103, Autumn.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Foreign Direct Investment; Industrial Workers; Cointegration; Autoregressive Distributed Lag; Saudi Arabia;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • F66 - International Economics - - Economic Impacts of Globalization - - - Labor

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