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Cultural Openness and Consumption Behavior in the MENA Region: A Dynamic Panel Analysis Using the GMM

Author

Listed:
  • Nashwa Mostafa Ali Mohamed

    (Department of Economics, College of Business Administration, King Saud University, P.O. Box 173, Riyadh 11942, Saudi Arabia)

  • Karima Mohamed Magdy Kamal

    (Department of Economics, College of Business Administration, King Saud University, P.O. Box 173, Riyadh 11942, Saudi Arabia)

  • Md Fouad Bin Amin

    (Department of Economics, College of Business Administration, King Saud University, P.O. Box 173, Riyadh 11942, Saudi Arabia)

  • El-Waleed Idris

    (Department of Marketing, College of Business Administration, King Saud University, P.O. Box 173, Riyadh 11942, Saudi Arabia)

  • Jawaher Binsuwadan

    (Department of Economics, College of Business Administration, Princess Nourah Bint Abdulrahman University, P.O. Box 84428, Riyadh 11671, Saudi Arabia)

Abstract

This study investigates the impact of cultural openness on intertemporal consumption behavior in the Middle East and North Africa (MENA) region, using panel data from 14 countries spanning 2010 to 2022. Unlike prior research that primarily focused on lifestyle shifts or product preferences, this study explores how cultural globalization influences the trade-off between present consumption and future savings, as captured by the consumption-to-savings ratio (LCESR). Cultural openness is operationalized using the Cultural Globalization General Index (LCGGI), and its effect is analyzed alongside key control variables including Internet penetration, real GDP per capita, inflation, and tourism. To address endogeneity and unobserved heterogeneity, this study employs the system Generalized Method of Moments (GMM) estimator, supported by robustness check models. The findings reveal a significant positive relationship between cultural openness and LCESR in both the short and long run, indicating that increased exposure to global cultural flows enhances consumption tendencies in the region. Internet penetration and inflation negatively affect saving behavior, while GDP per capita shows a positive effect. Tourist arrivals exhibit limited influence. This study also highlights the importance of historical consumption behavior, as the lagged dependent variable strongly predicts the current LCESR. Robustness checks confirm the consistency of the results across all models. These insights suggest that cultural openness, digital infrastructure, and macroeconomic stability are pivotal in shaping consumption/saving patterns. The results carry important implications for financial education, digital consumption governance, and cultural policy strategies in the MENA region and similar emerging markets undergoing rapid cultural integration.

Suggested Citation

  • Nashwa Mostafa Ali Mohamed & Karima Mohamed Magdy Kamal & Md Fouad Bin Amin & El-Waleed Idris & Jawaher Binsuwadan, 2025. "Cultural Openness and Consumption Behavior in the MENA Region: A Dynamic Panel Analysis Using the GMM," Sustainability, MDPI, vol. 17(15), pages 1-31, July.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:15:p:6656-:d:1706716
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    References listed on IDEAS

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