Oil Prices and Terms of Trade of Saudi Arabia: An Empirical Analysis

• 발행기관: 한국유통과학회
• 저자명: Mohammad Imdadul HAQUE Mohammad IMRAN
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』Vol. 7 No.9, 201~208쪽, 전체 8쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2020.09.30

영문 초록

Terms of trade is an important indicator of the welfare gains from international trade to the exporting country. Terms of trade of oil-exporting countries are hypothesized to depend primarily on oil prices. The study assesses the relation between oil prices and the terms of trade of Saudi Arabia. The study uses the Autoregressive Distributed Lag method to determine the cointegration between the country’s terms of trade and oil prices for the period 2000-2018. The data for net barter terms of trade is taken from World Development Indicators and oil price is taken from Saudi Arabian Monetary Agency. The results show that oil prices and terms of trade are cointegrated and any disequilibrium between the two variables is corrected by 35% in a year. The study also reports a positive relationship between the two items, both in the short run and long run. Diagnostic tests indicate the model to be fit. The results suggest that, for a primarily oil-producing country like Saudi Arabia, the terms of trade depend on oil prices. The study fills the gap in the literature on the study of terms of trade for Saudi Arabia for the last few years, where there has been a high volatility in oil prices.

목차

1. Introduction

2. Literature Review

3. Research Methods and Materials

4. Results and Discussion

5. Conclusions

References

키워드

Terms of Trade Oil Prices ARDL Diversification Saudi Arabia