IDEAS home Printed from https://ideas.repec.org/a/mth/ber888/v10y2020i4p13-25.html
   My bibliography  Save this article

Non-oil Revenue Impact on Economic Growth: Empirical Study of Saudi Arabia's Economy

Author

Listed:
  • Nedra Shili
  • Kavita Panjwani

Abstract

The kingdom of Saudi Arabia saw during the year 2019 an improve in its business environment, as indicated in the World Bank Ease of Doing Business 2020 report in which the Kingdom was the best reformer, gaining 30 places to place itself in 62nd position. 62% of the three hundred planned reforms in this area have been completed, including a new law on tenders and public procurement, new commercial courts, and a new concurrence law and planned laws on public-private partnerships. The country has recently released the VAT regulation for public consultation through the tax authority (GAZT) website. The VAT introduction presents an important policy in a country where economic system has always relied on oil revenues. The purpose of this study is to show the marked contrast between the impact of non-oil tax revenue (NOTR) and non-oil non-tax revenue (NONTR) on economic growth in Saudi Arabia. This study applied various essential statistical tools such as descriptive and correlation, paired sample t-test. The results demonstrate that NONTR and NOTR were positive and firmly associated with Nominal domestic product with Co-efficient(r=.888, p >0.05) and (r=.960, p

Suggested Citation

  • Nedra Shili & Kavita Panjwani, 2020. "Non-oil Revenue Impact on Economic Growth: Empirical Study of Saudi Arabia's Economy," Business and Economic Research, Macrothink Institute, vol. 10(4), pages 13-25, December.
  • Handle: RePEc:mth:ber888:v:10:y:2020:i:4:p:13-25
    as

    Download full text from publisher

    File URL: http://www.macrothink.org/journal/index.php/ber/article/view/17587/13749
    Download Restriction: no

    File URL: http://www.macrothink.org/journal/index.php/ber/article/view/17587
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 70(1), pages 65-94.
    3. Rebelo, Sergio, 1991. "Long-Run Policy Analysis and Long-Run Growth," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 500-521, June.
    4. Albassam, Bassam A., 2015. "Economic diversification in Saudi Arabia: Myth or reality?," Resources Policy, Elsevier, vol. 44(C), pages 112-117.
    5. T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
    6. Ivanyna, Maksym & von Haldenwang, Christian, 2012. "A comparative view on the tax performance of developing countries: Regional patterns, non-tax revenue and governance," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-44.
    7. Trevor W. Swan, 2002. "Economic Growth," The Economic Record, The Economic Society of Australia, vol. 78(243), pages 375-380, December.
    8. Chen, Been-Lon, 1997. "Economic growth : Robert J. Barro and Xavier Sala-i-Martin, (McGraw-Hill, 1995), 539 pp," Journal of Economic Dynamics and Control, Elsevier, vol. 21(4-5), pages 895-898, May.
    9. Liang, Qi & Teng, Jian-Zhou, 2006. "Financial development and economic growth: Evidence from China," China Economic Review, Elsevier, vol. 17(4), pages 395-411.
    10. Charfeddine, Lanouar & Barkat, Karim, 2020. "Short- and long-run asymmetric effect of oil prices and oil and gas revenues on the real GDP and economic diversification in oil-dependent economy," Energy Economics, Elsevier, vol. 86(C).
    11. Dar, Atul A. & AmirKhalkhali, Sal, 2002. "Government size, factor accumulation, and economic growth: evidence from OECD countries," Journal of Policy Modeling, Elsevier, vol. 24(7-8), pages 679-692, November.
    12. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    13. Alekhina, Victoriia & Yoshino, Naoyuki, 2018. "Impact of World Oil Prices on an Energy Exporting Economy Including Monetary Policy," ADBI Working Papers 828, Asian Development Bank Institute.
    14. David Cass, 1965. "Optimum Growth in an Aggregative Model of Capital Accumulation," Review of Economic Studies, Oxford University Press, vol. 32(3), pages 233-240.
    15. Veblen, Thorstein, 1915. "Imperial Germany and The Industrial Revolution," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1915.
    16. Sylviane GUILLAUMONT JEANNENEY & PING HUA & ZHICHENG LIANG, 2006. "Financial Development, Economic Efficiency, And Productivity Growth: Evidence From China," The Developing Economies, Institute of Developing Economies, vol. 44(1), pages 27-52, March.
    17. Narayan, Paresh Kumar & Narayan, Seema, 2007. "Modelling oil price volatility," Energy Policy, Elsevier, vol. 35(12), pages 6549-6553, December.
    18. Fredj Jawadi & Nabila Jawadi & Abdoulkarim Idi Cheffou, 2018. "Toward a new deal for Saudi Arabia: oil or Islamic stock market investment?," Applied Economics, Taylor & Francis Journals, vol. 50(59), pages 6355-6363, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Petrakos, George & Dimitris, Kallioras & Ageliki, Anagnostou, 2007. "A Generalized Model of Regional Economic Growth in the European Union," Papers DYNREG12, Economic and Social Research Institute (ESRI).
    2. repec:ebl:ecbull:v:2:y:2002:i:1:p:1-15 is not listed on IDEAS
    3. repec:zbw:bofrdp:2010_021 is not listed on IDEAS
    4. Thomas M. Steger, 2000. "Productive Consumption and Growth in Developing Countries," Review of Development Economics, Wiley Blackwell, vol. 4(3), pages 365-375, October.
    5. Tung Liu & Kui-Wai Li, 2015. "The Empirics of Economic Growth and Industrialization Using Growth Identity Equation," Working Papers 201501, Ball State University, Department of Economics, revised Jun 2015.
    6. Voosholz, Frauke, 2014. "A survey on modeling economic growth. With special interest on natural resource use," CAWM Discussion Papers 69, University of Münster, Münster Center for Economic Policy (MEP).
    7. Mateusz Błaszczyk & Leszek Kwieciński & Magdalena Stawicka & Marek Wróblewski, 2017. "Przedsiębiorstwa w parkach technologicznych a paradygmat gospodarki opartej na wiedzy," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 1, pages 69-94.
    8. Aykut Kibritçioglu, 2002. "On the Smithian origins of "new" trade and growth theories," Economics Bulletin, AccessEcon, vol. 2(1), pages 1-15.
    9. Ali, Amjad, 2022. "Financial Liberalization, Institutional Quality and Economic Growth Nexus: Panel Analysis of African Countries," MPRA Paper 116329, University Library of Munich, Germany, revised 2022.
    10. Bofinger, Peter & Geißendörfer, Lisa & Haas, Thomas & Mayer, Fabian, 2023. "Credit as an instrument for growth: A monetary explanation of the Chinese growth story," W.E.P. - Würzburg Economic Papers 107, University of Würzburg, Department of Economics.
    11. Knaap, T., 1998. "A survey of complementaries in growth and location theories," Research Report 98C44, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    12. Charles R. Hulten, 1996. "Quality Change in Capital Goods and Its Impact on Economic Growth," NBER Working Papers 5569, National Bureau of Economic Research, Inc.
    13. Sefa Awaworyi Churchill & Mehmet Ugur & Siew Ling Yew, 2017. "Does Government Size Affect Per-Capita Income Growth? A Hierarchical Meta-Regression Analysis," The Economic Record, The Economic Society of Australia, vol. 93(300), pages 142-171, March.
    14. Bennett T. McCallum, 1996. "Neoclassical vs. endogenous growth analysis: an overview," Economic Quarterly, Federal Reserve Bank of Richmond, issue Fall, pages 41-71.
    15. Robert J. Barro, 2013. "Health and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 14(2), pages 329-366, November.
    16. Kar Muhsin & Peker Osman & Kaplan Muhittin, 2008. "Trade Liberalization, Financial Development and Economic Growth in The Long Term: The Case of Turkey," South East European Journal of Economics and Business, Sciendo, vol. 3(2), pages 25-38, November.
    17. Aslý YENÝPAZARLI, 2017. "Economic freedom and effects on economic growth: A time series analysis for Turkey," Turkish Economic Review, KSP Journals, vol. 4(3), pages 345-351, September.
    18. Ikonen, Pasi, 2010. "Effect of finance on growth through more efficient utilization of technological innovations," Research Discussion Papers 21/2010, Bank of Finland.
    19. Amavilah, Voxi Heinrich, 2014. "Knowledge = Technology + Human Capital and the Lucas and Romer Production Functions," MPRA Paper 58847, University Library of Munich, Germany.
    20. Mariusz Próchniak & Bartosz Witkowski, 2006. "Modelowanie realnej konwergencji w skali międzynarodowej," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 10, pages 1-31.
    21. Xavier Sala-i-Martin, 1990. "Lecture Notes on Economic Growth(I): Introduction to the Literature and Neoclassical Models," NBER Working Papers 3563, National Bureau of Economic Research, Inc.
    22. Ikonen, Pasi, 2010. "Effect of finance on growth through more efficient utilization of technological innovations," Bank of Finland Research Discussion Papers 21/2010, Bank of Finland.

    More about this item

    Keywords

    Non-oil non-tax revenue; Tax revenue; Oil revenue; Nominal domestic product; Economic growth; Saudi Arabian economy; Value added tax; General authority for Zakat and tax;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mth:ber888:v:10:y:2020:i:4:p:13-25. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Technical Support Office (email available below). General contact details of provider: http://www.macrothink.org/journal/index.php/ber .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.