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Calculating the income counterfactual for oil producing countries of the MENA region

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  • Majbouri, Mahdi

Abstract

How much richer would the oil producing countries, in the Middle East, be if they invested all their natural resource rent? This study tries to answer this question by calculating the counterfactuals of capital stock and income under two major scenarios. Combining several data sets, including a unique one on sovereign wealth funds, it finds that the oil producing economies of the MENA region could have had on average about 0.4 percentage point higher growth rate if they had used their natural resource rents efficiently. This difference in growth rate translates to about 17% higher income over a 40 year period. These numbers are calculated for each country separately and their important policy implications are discussed.

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  • Majbouri, Mahdi, 2015. "Calculating the income counterfactual for oil producing countries of the MENA region," Resources Policy, Elsevier, vol. 44(C), pages 47-56.
    • Handle: RePEc:eee:jrpoli:v:44:y:2015:i:c:p:47-56
    DOI: 10.1016/j.resourpol.2014.12.005
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    Cited by:

    1. Ansari, Dawud, 2016. "Resource curse contagion in the case of Yemen," Resources Policy, Elsevier, vol. 49(C), pages 444-454.
    2. Alssadek, Marwan & Benhin, James, 2023. "Natural resource curse: A literature survey and comparative assessment of regional groupings of oil-rich countries," Resources Policy, Elsevier, vol. 84(C).
    3. Yu, Yun & Lei, Yalin, 2017. "China's provincial exhaustible resources rent and produced capital stock—Based on Hartwick's rule," Resources Policy, Elsevier, vol. 52(C), pages 114-121.
    4. Mahdi Majbouri, 2017. "Oil, Laws, and Female Labor Force Participation," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 23(1), pages 91-106, February.
    5. Majbouri, Mahdi, 2016. "Oil and entrepreneurship," Energy Policy, Elsevier, vol. 94(C), pages 10-15.

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    More about this item

    Keywords

    Resource rent; Economic growth; Middle East and North Africa;
    All these keywords.

    JEL classification:

    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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