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Impact of devaluation on Saudi oil exports: The J-Curve analysis

Author

Listed:
  • Mahmood, Haider
  • Alkhateeb, Tarek Tawfik Yousef
  • Ahmed, Nawaz

Abstract

This research probes the impact of Exchange Rate (ER) and oil prices on oil-exports of leading OPEC country, Saudi Arabia by using Shin’s et al. (2014) non-linear ARDL. We find that world income is helping in increasing Saudi oil-exports and the insignificant impact of ER on oil-exports in linear ARDL is found. Alternatively, a positive ER variable is negatively impacting to oil-exports and an appreciation is result in decrease in oil-exports. Further, in long a devaluation, negative ER, could not help in increasing oil-exports. But, short run analysis expose the existence of W-curve instead of J-curve with devaluation in the non-linear ARDL model and J-curve has been found in the linear ARDL model. Positive Oil prices’ movement is also helping in raising oil-exports and negative movement has no impact. Lastly, the impacts of both ER and oil-prices have the asymmetrical impacts.

Suggested Citation

  • Mahmood, Haider & Alkhateeb, Tarek Tawfik Yousef & Ahmed, Nawaz, 2017. "Impact of devaluation on Saudi oil exports: The J-Curve analysis," MPRA Paper 109454, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:109454
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    References listed on IDEAS

    as
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    2. Alkhateeb, Tarek Tawfik Yousef & Mahmood, Haider & Sultan, Zafar Ahmad & Ahmad, Nawaz, 2017. "Trade Openness and Employment Nexus in Saudi Arabia," MPRA Paper 109451, University Library of Munich, Germany.
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    Cited by:

    1. Mahmood, Haider & Chaudhary, A. R., 2013. "Impact of FDI on Income Inequality in Pakistan," MPRA Paper 109460, University Library of Munich, Germany.
    2. Alkhateeb, Tarek Tawfik Yousef & Mahmood, Haider & Sultan, Zafar Ahmad & Ahmad, Nawaz, 2017. "Trade Openness and Employment Nexus in Saudi Arabia," MPRA Paper 109451, University Library of Munich, Germany.
    3. Al-Qahtani, Maleeha Mohammed Zaaf & Alkhateeb, Tarek Tawfik Yousef & Mahmood, Haider & Abdalla, Manal Abdalla Zahed & Mawad, Ghada Shihata Ebrahim & Alkhatib, Maha Ahmed Hussein, 2020. "Exploring the Level of Managerial, Political, Academic, Economic and Social Women Empowerment in Saudi Arabia," MPRA Paper 109447, University Library of Munich, Germany.
    4. Alkhateeb, Tarek Tawfik Yousef & Alkahtani, Nasser Saad & Mahmood, Haider, 2017. "Assessing the Role of Foreign Labour on Saudi Labour Unemployment in Saudi Arabia," MPRA Paper 109449, University Library of Munich, Germany.
    5. Alkhateeb, Tarek Tawfik Yousef & Mahmood, Haider & Sultan, Zafar Ahmad & Ahmad, Nawaz, 2017. "Financial Market Development and Employment Nexus in Saudi Arabia," MPRA Paper 109450, University Library of Munich, Germany.
    6. Mahmood, Haider & Alkhateeb, Tarek Tawfik Yousef & Ahmad, Nawaz, 2017. "Impact of Devaluation on Foreign Trade in Saudi Arabia," MPRA Paper 109452, University Library of Munich, Germany.
    7. Mahmood, Haider, 2018. "An Investigation of Macroeconomic Determinants of FDI Inflows in Bangladesh," MPRA Paper 109448, University Library of Munich, Germany.
    8. Mahmood, Haider & Alkhateeb, Tarek Tawfik, 2017. "An Estimation of Service Quality in King Khalid Hospital, Saudi Arabia," MPRA Paper 109453, University Library of Munich, Germany.

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    More about this item

    Keywords

    OIl price; OIl exports; devaluation;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade

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