Diversification Of The Economy Of Saudi Arabia

Abstract

The falling price of crude oil across the globe calls for countries endowed with this resource and largely depends on it to diversify. This thesis examines the diversification of the economy Saudi Arabia. In carrying out this study, the net export and the construction of the Herfindahl Hirschman Index (HHI) in determining the measures of export concentration were included in the control variables while real GDP represent the dependent variable. A restricted Vector auto-regression model based on ARDL bounds testing approach to co-integration was adopted to investigate the present of long run equilibrium relationship among the variables. The finding shows a long run relationship among the variables and based on this, diversification will impact the economy of Saudi Arabia positively.