Impact of devaluation on Saudi oil exports: The J-Curve analysis

Haider Mahmood (), Tarek Tawfik Yousef Alkhateeb and Nawaz Ahmed

MPRA Paper from University Library of Munich, Germany

Abstract: This research probes the impact of Exchange Rate (ER) and oil prices on oil-exports of leading OPEC country, Saudi Arabia by using Shin’s et al. (2014) non-linear ARDL. We find that world income is helping in increasing Saudi oil-exports and the insignificant impact of ER on oil-exports in linear ARDL is found. Alternatively, a positive ER variable is negatively impacting to oil-exports and an appreciation is result in decrease in oil-exports. Further, in long a devaluation, negative ER, could not help in increasing oil-exports. But, short run analysis expose the existence of W-curve instead of J-curve with devaluation in the non-linear ARDL model and J-curve has been found in the linear ARDL model. Positive Oil prices’ movement is also helping in raising oil-exports and negative movement has no impact. Lastly, the impacts of both ER and oil-prices have the asymmetrical impacts.

Keywords: OIl price; OIl exports; devaluation (search for similar items in EconPapers)
JEL-codes: F1 (search for similar items in EconPapers)
Date: 2017-07-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published in International Journal of Economic Research. 9.14(2017): pp. 375-383

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:109454

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