nep-ara New Economics Papers
on Arab World
Issue of 2012‒01‒18
nine papers chosen by
Quentin Wodon
World Bank

  1. Do Bubbles Spill Over? Estimating Financial Bubbles in Emerging Markets: Case of Turkey By Ozan Hatipoglu; Onur Uyar
  2. Stylized Facts for Business Cycles in Turkey By Harun Alp; Yusuf Soner Baskaya; Mustafa Kilinc; Canan Yuksel
  3. Corporate governance, opaque bank activities, and risk/return efficiency: Pre- and post-crisis evidence from Turkey By O. DE JONGHE; M. DISLI; K. SCHOORS
  4. Bringing It All Back Home Return migration and fertility choices By Francesca MARCHETTA; Simone BERTOLI
  5. Inflation Differentials in the GCC: Does the Oil Cycle Matter? By Kamiar Mohaddes; Oral Williams
  6. Desynchronized: The Comovement of Non-Hydrocarbon Business Cycles in the GCC By Serhan Cevik
  7. An Empirical Study on Liquidity and Bank Lending By Koray Alper; Timur Hulagu; Gursu Keles
  8. Le migrazioni ambientali nel Mediterraneo: il caso studio dei paesi del Medio Oriente e del Nord Africa By Venditto , Bruno; Caruso , Immacolata
  9. Oil Prices, External Income, and Growth: Lessons from Jordan By Kamiar Mohaddes; Mehdi Raissi

  1. By: Ozan Hatipoglu; Onur Uyar
    Date: 2011–06
  2. By: Harun Alp; Yusuf Soner Baskaya; Mustafa Kilinc; Canan Yuksel
    Abstract: This study documents the stylized facts about the business cycles in Turkey using quarterly data between 1987 and 2009. In particular, we document the business cycle turning points and average duration of cycles for Turkey, as well as the optimal smoothing parameter for Hodrick-Prescott (HP) filter estimated in line with our estimate of average business cycle duration for 1987-2009 period, 20 quarters, which is shorter compared to developed countries, and comparable to other developing countries. For filtering procedure, we use this estimated parameter, in addition to 1600, in HP filter and compare our findings. We find that business cycle relationships between macroeconomic variables in Turkey are mostly in accordance with the patterns observed for developing countries, which significantly differ from developed countries’ business cycle facts. In particular, the real side of the economy is characterized by high volatility of consumption and a countercyclical pattern for net exports. Other important findings are that financial variables such as credit or sovereign spreads are very volatile and strongly correlated with output. In addition, the results show that the properties of the relationship between economic activity, prices and the interest rates differs between pre-2001 and post-2001 period, whereas the relationship among the real variables shows a smaller change between these periods.
    Keywords: Nominal Business Cycle Facts, Real Business Cycle Facts, Turkish Economy
    JEL: E1 E3 E5
    Date: 2012
    Abstract: Does better corporate governance unambiguously improve the risk/return efficiency of banks? Or does either a re-orientation of banks' revenue mix towards more opaque products, an economic downturn, or tighter supervision create off-setting or reinforcing effects? The authors relate bank efficiency to shortfalls from a stochastic risk/return frontier. They analyze how internal governance mechanisms (CEO duality, board experience, political connections, and education profile) and external governance mechanisms (discipline exerted by shareholders, depositors, or skilled employees) determine efficiency in a sample of Turkish banks. The 2000 financial crisis was a wakeup call for bank efficiency and corporate governance. As a result, better corporate governance mechanisms have been able to improve risk/return efficiency when the economic, regulatory, and supervisory environments are more stable and bank products are more complex.
    Keywords: corporate governance, bank risk, noninterest income, crisis, frontier
    Date: 2011–07
  4. By: Francesca MARCHETTA; Simone BERTOLI
    Abstract: Return migration exerts wide-ranging influence upon the countries of origin of the migrants. We analyze whether returnees adjust their fertility choices to match the norms which prevail in their previous countries of destinations, using Egyptian household-level data. Egyptians migrate predominantly towards other Arab countries characterized by higher fertility rates. Relying on a two-step instrumental variable approach to control for the endogeneity of the migration decisions, we show that return migration has a significant and positive influence on the total number of children. These results suggest that migration might not be an unmitigated blessing for Egypt, as it has contributed to slow down the process of demographic transition.
    Keywords: temporary migration; fertility; household-level data; North Africa; Egypt
    Date: 2012
  5. By: Kamiar Mohaddes; Oral Williams
    Abstract: This paper uses a pairwise approach to investigate the main factors that have been driving inflation differentials in the Gulf Cooperation Council (GCC) region for the past two decades. The results suggest that inflation differentials in the GCC are largely influenced by the oil cycle, mainly through the credit and fiscal channels. This implies that closer coordination of fiscal policies will be key for facilitating the closer integration of the GCC economies and ahead of the move to a monetary union. The results also indicate that after controlling for cyclical factors, convergence increased even during the recent oil boom.
    Keywords: Business cycles , Cooperation Council for the Arab States of the Gulf , Inflation , Oil revenues , Oil sector ,
    Date: 2011–12–15
  6. By: Serhan Cevik
    Abstract: This paper investigates the empirical characteristics of business cycles and the extent of cyclical comovement in the Gulf Cooperation Council (GCC) countries, using various measures of synchronization for non-hydrocarbon GDP and constituents of aggregate demand during the period 1990-2010. By applying the Christiano-Fitzgerald asymmetric band-pass filter and a mean corrected concordance index, the paper identifies the degree of non-hydrocarbon business cycle synchronization—one of the main prerequisites for countries considering to establish a monetary union. The empirical results show low and heterogeneous synchronization in non-hydrocarbon business cycles across the GCC economies, and a decline in the degree of synchronicity in the 2000s, if Kuwait is excluded from the sample, partly because of divergent fiscal policies.
    Keywords: Business cycles , Cooperation Council for the Arab States of the Gulf , Economic models , Hydrocarbons , Monetary unions ,
    Date: 2011–12–06
  7. By: Koray Alper; Timur Hulagu; Gursu Keles
    Abstract: In this study, by using a panel data of Turkish banks, we empirically analyze whether monetary policies that are able to manipulate liquidity positions of banks can affect bank lending. Our results suggest that bank specific liquidity is important in credit supply. Moreover, in determining their lending, banks consider not only their individual liquidity position but also the systemic liquidity. Hence, any monetary policy which can alter liquidity is potentially effective on credit supply.
    Keywords: Bank lending channel, Systemic liquidity, Panel data
    JEL: C23 E44 E58 G21
    Date: 2012
  8. By: Venditto , Bruno; Caruso , Immacolata
    Abstract: The study offer a contribution to the analysis of the problems linked to the environmental migration focusing on a specific Mediterranean area, that of the Middle East and Northern Africa. After a brief analysis of the socio-economic and environmental context, used to describe the vulnerability features of the area, the studies will assess the regional migration system particularly the so called "forced migrants". Due to the lack of an accepted common international definition of environmental refugees, following the most recent literature in this study we have used the definition of forded migration to assess the environmental migration. This in fact, among the causes of migration considers not only the "physical environment" but a plethora of socio economic factors which interact among themselves and force people to migrate. In this definitions we include: Internal Displaced Persons, forced to move for the modification of the habitat where they live caused by natural or human disasters but also Migrants and IDPs forced to move due to the implementation of developmental project such as the construction of mega infrastructure such as dams, or the mining and deforestation activities, as well as the the migrants who sick asylum due to conflicts, civil wars or internal persecution
    Keywords: Migration; Environment; DEvelopment
    JEL: Q50 O15 Q01
    Date: 2011–12
  9. By: Kamiar Mohaddes; Mehdi Raissi
    Abstract: This paper extends the long-run growth model of Esfahani et al. (2009) to a labor exporting country that receives large inflows of external income—the sum of remittances, FDI and general government transfers—from major oil-exporting economies. The theoretical model predicts real oil prices to be one of the main long-run drivers of real output. Using quarterly data between 1979 and 2009 on core macroeconomic variables for Jordan and a number of key foreign variables, we identify two long-run relationships: an output equation as predicted by theory and an equation linking foreign and domestic inflation rates. It is shown that real output in the long run is shaped by: (i) oil prices through their impact on external income and in turn on capital accumulation, and (ii) technological transfers through foreign output. The empirical analysis of the paper confirms the hypothesis that a large share of Jordan's output volatility can be associated with fluctuations in net income received from abroad. External factors, however, cannot be relied upon to provide similar growth stimuli in the future, and therefore it will be important to diversify the sources of growth in order to achieve a high and sustained level of income.
    Keywords: Capital inflows , Economic growth , Economic models , External shocks , Foreign direct investment , Income , Jordan , Oil prices , Workers remittances ,
    Date: 2011–12–12

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