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What if Saudi Arabia’s Population Reached 50 Million by 2030?

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Abstract

This paper examines the economic impacts of a 43% population increase in Saudi Arabia under Vision 2030 reforms using a computable general equilibrium (CGE) framework. This study utilizes for the first time our organization's unique SAM version for Saudi Arabia, which is derived from the recent GTAP database 11 (Agujar et al., 2022) with a base year of 2021. It also incorporates and updates entries using the latest input-output (IO) tables for Saudi Arabia. Through three scenarios: fixed labor and capital, flexible labor and capital, and a 20% increase in skilled labor, the results show minimal changes in GDP in Scenario 1, with gains in agriculture and food sectors. Scenario 2, with endogenous labor and capital, reveals declines in GDP and trade balances, but continued growth in food and agriculture sectors. In Scenario 3, an increase in skilled labor leads to significant productivity gains in various sectors, especially in technology and manufacturing. Despite these gains, overall welfare remains negative for GCC countries due to allocative inefficiencies and resource shifts. The findings highlight the need for strategic investments in human capital and sectoral diversification to address the challenges of rapid population growth.

Suggested Citation

  • Hassan, Sherif, 2025. "What if Saudi Arabia’s Population Reached 50 Million by 2030?," MSR Working Papers 26-2025, M&S Research Hub institute.
    • Handle: RePEc:ris:msrwps:2025_026
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    More about this item

    Keywords

    Saudi Arabia; CGE; Macroeconomics; Migration;
    All these keywords.

    JEL classification:

    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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