nep-ara New Economics Papers
on MENA - Middle East and North Africa
Issue of 2018‒09‒17
twelve papers chosen by
Paul Makdissi
Université d’Ottawa

  1. Reforming fiscal institutions in resource-rich Arab economies: Policy proposals By Kamiar Mohaddes; Jeffrey B. Nugent; Hoda Selim
  2. Oil Price Fluctuations and Exchange Rate Dynamics in the MENA Region: Evidence from Non-Causality-in- Variance and Asymmetric Non-Causality Tests By Ridha Nouira; Thouraya Hadj Amor; Christophe Rault
  3. Analysis of Unemployment Determinants in North Africa Countries, à Panel Data co-integration Approach By RABAH BELABBAS; rabia bellatreche; talal zaghba
  4. The End of Boom and the Political Economy of Turkey’s crisis By Oyvat, Cem
  5. Evidence on the Nature and Extent of Fall in Oil Prices on the Financial Performance of Listed Companies: A Ratio Analysis Case Study of the Insurance Sector in the UAE By Pallavi Kishore; Mariam Aslam
  6. The Financial Performance-Corporate Reputation Nexus in Turkey By ALI PISKIN; AYSE ILGUN KAMANLI
  7. A Critical Evaluation of Affordable Housing Provision in Saudi Arabia By Ahmad Abed; Neil Dunse; Colin Jones
  8. Macroeconomic Conditions and Child Schooling in Turkey By Güneş, Pinar Mine; Ural Marchand, Beyza
  10. Attitudes Toward the Use of Treated Wastewater: A Survey of the Rural Population in Egypt By Abdelradi, Fadi; Ewiss, Mohamed A. Zaki; Guesmi, Bouali
  11. Regional financial governance: a lever for change for advanced regionalization in Morocco By Aziza Benkada; Mohammed Belouchi; Assia Iallouchen; Mehdi Essarsar
  12. The analysis of the relationship between internationally accredited educational quality and the quality perception of the students studying at an English preparatory school of a foundation university By Ersoy M. Uçar

  1. By: Kamiar Mohaddes; Jeffrey B. Nugent; Hoda Selim
    Abstract: This paper traces the evolution of fiscal institutions of Resource Rich Arab Economies (RRAEs) over time since their pre-oil days, through the discovery of oil to their build-up of oil exports. It then identifies challenges faced by RRAEs and variations in their severity among the different countries over time. Finally, it articulates specific policy reforms, which, if implemented successfully, could help to overcome these challenges. In some cases, however, these policy proposals may give rise to important trade-offs that will have to be evaluated carefully in individual cases.
    Keywords: Fiscal policy, fiscal institutions, fiscal sustainability, public spending efficiency, budget transparency, fiscal rules, volatility, oil curse, Arab World, oil exporters, and Middle East and North Africa.
    JEL: E02 E62 H50 H60 H61 O53
    Date: 2018–09
  2. By: Ridha Nouira; Thouraya Hadj Amor; Christophe Rault
    Abstract: The aim of this paper is to investigate the exchange rate consequences of oil-price fluctuations and to test for the dynamics of oil price volatility by examining interactions between oil market and exchange rate in selected MENA countries (Egypt, Jordan, Morocco, Qatar, Saudi Arabia, Tunisia, and UAE). Using daily time series data covering the period from January 1, 2001 to December 29, 2017, we implement the test for asymmetric non-causality of Hatemi-J (2012), the asymmetric generalized impulse response functions of Hatemi-J (2014), and the test for noncausality-in-variance of Hafner and Herwartz (2006) to examine the presence of volatility spillover between oil prices and exchange rates return series. The econometric investigation reveals in particular that i) when prices are rising in Tunisia and Saudi Arabia, oil prices cause change in exchange rates, and ii) there is significant evidence of volatility spillovers from oil markets to exchange rate markets in the selected MENA countries. These findings have important implications both from the investor's and from the policy-maker's perspective.
    Keywords: oil price shocks, exchange rate volatility, asymmetric causality test, asymmetric generalized impulsion functions, causality-in-variance tests, MENA countries
    JEL: F31 G01 Q43
    Date: 2018
  3. By: RABAH BELABBAS (University of Mouhamed Boudiaf M?sila ALGERIA); rabia bellatreche (university of Bouira); talal zaghba (university of msila)
    Abstract: The aim of this study is to determine the Macroeconomic Determinants of unemployment in four countries of North Africa which are: Morocco, Algeria, Tunisia and Egypt. This study has applied the PANEL-VECM Model using annual data from 2000 to 2016 of unemployment rate, growth economic, government expenditure, money supply, oil price and population size, the data were taken From World Bank (WDI).Our results show that there is a long run relationship between unemployment and those macroeconomics variables in north Africa countries. in the short run, unemployment is defined by growth economic with a strong negative effect, but in the long run growth economic affects positively unemployment, but economic policies don?t affect unemployment in the short run, in the long run government expenditure and money supply affect negatively unemployment, but the impact of fiscal policy is more than monetary policy impact, oil price has a negative significant effect in the lag two, in the long run the impact of oil prices on unemployment is positive, population size don?t affect unemployment in the short run, however its impact is positively in the long run.
    Keywords: Unemployment, Economic Growth, economic policies, Panel Data Cointegration.
    JEL: C33 E52 J69
    Date: 2018–06
  4. By: Oyvat, Cem
    Abstract: Turkey has long been enjoying high growth rates with the support of speculative financial flows and a boom in the construction industry. However, the Turkish economy at the same time was step-by-step becoming more fragile during the recent years. The diplomatic crisis between the US and Turkey gave a push to the economic downturn in Turkey that was already coming. Indeed, the Turkish Lira already depreciated by more than 20% against USD in 2018 before the diplomatic tension peaked. The depreciation in the Turkish Lira against USD for 2018 was 43% at the date that this article was written.
    Keywords: Turkey; boom-bust cycles; crisis; inequality
    Date: 2018–09–06
  5. By: Pallavi Kishore (Middlesex University Dubai); Mariam Aslam (Middlesex University Dubai)
    Abstract: The sharp decline in oil prices that started in 2014 affected most economies in the world either positively or negatively. United Arab Emirates has been striving to diversify away from oil and expects higher non-oil growth in 2018. This study involves calculations and comparisons of ratios pre and post the fall in oil prices in the insurance sector in the UAE. Parametric tests, conclude that while the change in profitability and efficiency ratios is statistically significant, the other ratios have been quite stable in the period. There has been an overall slowdown in the insurance industry yet UAE has been mostly resilient to the fall in oil prices and given the visionary leadership of its policy makers, the diversification strategy has taken effect rather quickly.
    Keywords: Insurance Sector, Oil prices, Parametric test, Profitability, Ratio analysis, United Arab Emirates
    Date: 2018–07
    Abstract: There is a growing interest in corporate reputation among researches. Those who indicate the institutional and organizational stability as main source of economic growth state that any endeavor of corporates increasing production and employment is no longer sufficient for sustainable growth. It is obvious that national economies need intangible assets as far as tangible ones. Corporate reputation is one of these intangible assets. Reputation of any organization entirely depends on stakeholders? perception. The presence and level of this perception are affected by some factors associated with the positions of external and internal stakeholders. In this context, we investigate the potential linkage between corporate reputation and financial performance of corporates in Turkey between 2006 and 2016. This study aims to identify the financial determinants of corporate reputation as well as perception of stakeholders. Our data set is balanced panel. The dependent variable is the current reputation rankings which are output of Capital Magazine?s survey of ?Most Admired Companies of Turkey?. This survey has been conducted since 1999, and respondents are professional managers. In order to have a balanced panel, we evaluate six companies which were in top 20 for the longest time together, and whose stocks are traded in Borsa Istanbul. Our independent variables are return on equity (ROE), current ratio (CR), debt ratio (DR), asset turnover ratio (ATR), growth of marketing expenditures, and previous reputation ranking of company. GDP growth rate, origin country of company, and company?s sector are control variables. Data sample is based on Capital?s survey, balance sheets and income statements of the companies. We employ a random-effects model for estimation. The preliminary results show that there are significant relationships between ROE, ATR, previous reputation ranking, company?s sector, and current reputation ranking. While ROE would increase, the current reputation of the company would be higher. On the other hand, our model indicates that there is a positive relationship between ATR and the current reputation ranking. These first results will inevitably lead to management policy advices for professional managers to build a sustain reputation in micro level. Additionally, some macro policy proposals can be inferred through the institutional-based view.
    Keywords: Corporate reputation, financial performance, stakeholder's perception
    JEL: D22 L14 M14
    Date: 2018–06
  7. By: Ahmad Abed; Neil Dunse; Colin Jones
    Abstract: Housing plays a key role in our quality of life. It is important that countries understand and analyse their housing sectors to evaluate the “effects of national level policies on housing supply at the other and assess the efficiency and equity of housing policies” (Tipple, 2003:2). Ultimately governments put into place policies that assist local councils to plan, build, and manage places where people live. This includes policies that relate to diverse issues such as renting, public housing, and affordability, a concept that has “become a more important issue in housing Policy” in recent years (Bramley, 2012:133).Saudi Arabia is a developing country with a brief history of less than 90 years. Driven by the discovery of Oil in 1938, the country has gone through massive economic development and population growth in a very brief period. While this rapid urbanization process has affected all sectors in Saudi Arabia, the residential sector specifically has struggled to adapt to the realities of these changes.From a governmental perspective, support for the housing sector is limited to government budget allocations that lack strong governmental policy. In addition, there is no clear standard system concerning means of supporting housing (GIZ, 2013). Policies to promote the provision of affordable housing have largely failed.Therefore, this research aims to develop an affordable housing model that is applicable to middle-income households in Saudi Arabia. This is by identifying the critical drivers that influence the development of affordable housing solutions from both a planning policy and socio-cultural perspective in Saudi Arabia. These critical elements have directly contributed to the development and understanding of affordable housing policy as well as in conceptualizing the process for the purpose of this research. So, this paper will review the housing policy context within Saudi Arabia and present some of the initial findings from the analysis conducted.
    Keywords: Affordability; Affordable Housing; Housing; Housing Policy; Saudi Arabia
    JEL: R3
    Date: 2018–01–01
  8. By: Güneş, Pinar Mine (University of Alberta); Ural Marchand, Beyza (University of Alberta)
    Abstract: This paper examines the effects of macroeconomic shocks on child schooling in Turkey using household labor force surveys from 2005-2013. We use variation in local labor demand as an instrumental variable, particularly regional industry composition and national industry employment growth rates. The results demonstrate that child schooling is pro-cyclical in Turkey, with the most acute effects among children with less educated parents and living in rural areas. Finally, as hypothesized, we find asymmetric effects on child schooling based on skill composition of economic growth. Higher unemployment among unskilled workers increases schooling, whereas higher unemployment among skilled workers decreases schooling.
    Keywords: schooling, unemployment, business cycles, Turkey
    JEL: J13 J24 O15
    Date: 2018–07
  9. By: Jaghdani, Tinoush Jamali; Kvartiuk, Vasyl
    Abstract: The depletion of groundwater resources due to irrigation water pumping in Iran has become a serious problem which threatens both rural life and sustainable development in the country. The latest estimates show that 70% of groundwater resources have been overexploited in the last 15 years. Intensive and ever-increasing use has become one of the primary reasons behind the devastation of groundwater resources, both quantitatively and qualitatively. For many years, huge energy consumption subsidies (electricity or gasoline) have been provided for pumping irrigation water from aquifers. The resulting cheap energy makes deep water pumping possible and huge investment in deepening and relocating wells feasible. Since the reforms appear to be very difficult to implement on the political level, we focus on the political economy of subsidy provision for irrigation water and energy for pumping in Iran. We analyse how the interests of rural inhabitants are represented in Iranian parliament and examine the decision-making process of the parliamentarians in voting for eliminating the subsidies. Results show that Iranian leaders follow the logic of regime maintenance and may have incentives to strategically overrepresent rural interests in the parliament. Importantly, we found that the decision to support subsidies for irrigation water is motivated by economic factors rather than by ideological incentives. Political economy appears to be a useful framework to understand the obstacles of phasing out subsidies depleting not only ground water resources but the state budget as well.
    Date: 2018–09–01
  10. By: Abdelradi, Fadi; Ewiss, Mohamed A. Zaki; Guesmi, Bouali
    Abstract: Treated WasteWater (TWW) projects can fail if the factors controlling their implementation are not considered. This paper analyze the findings of a survey (966 participants) conducted to investigate the attitudes of the Egyptian rural public towards TWW use for non-potable applications using a conceptual framework elaborated based on the literature estimated using Structural Equation Modeling (SEM). Results indicate that the factors considered in the analysis of the conceptual framework were found to be relevant in explaining the participants’ behavior towards WasteWater Reuse (WWR). Our findings suggest considering these factor when developing new policies and campaigns for WWR prior to implementation.
    Keywords: Environmental Economics and Policy
    Date: 2017–08–28
  11. By: Aziza Benkada (Université Mohammed Premier [Oujda]); Mohammed Belouchi; Assia Iallouchen (UAE - Université Abdelmalek Essaâdi); Mehdi Essarsar (UAE - Université Abdelmalek Essaâdi)
    Abstract: The adoption of the Advanced Regionalization project in 2015, is part of a new model of governance and territorial intelligence. Regional financial governance is a process that stems from the overflow of inherited formal institutional systems to a system where responsibilities are shared between the State and the regions. Growth, employment, cohesion and the reduction of regional disparities are all mentioned assets, which aims at empowering regional actors and giving them the capacity and resources to develop.
    Keywords: Advanced regionalization, regional development, territorial policies, territorial dynamics,territorial authorities, regional disparities, financial equalization, financial governance,the region.
    Date: 2018–08–21
  12. By: Ersoy M. Uçar (?stanbul Commerce University)
    Abstract: In today?s world, all the higher education institutions across the world are trying to keep and improve their educational standards in order to respond to the ever-changing needs and expectations of all their stakeholders and to survive under great environmental pressure resulting from the stiff global and local competition. To this end, they need to plan, control and improve their own educational quality on a regular and continuous basis. However, if there is a considerable gap between the internationally agreed-upon quality standards and the quality offered within the institutional framework, it will be very difficult to claim objectively that the educational services provided are of the highest achievable quality. Thus, obtaining international quality accreditation is of crucial importance both in proving the educational quality offered institutionally and persuading all the stakeholders that the education provided is planned, monitored, evaluated and improved in line with the predefined and preset international quality standards. On the other hand, having an international quality accreditation as a higher education institution might not always guarantee a positive quality perception on the students? part, who are the actual consumers of the quality. The main purpose of this study is to analyze the relationship between the internationally accredited educational quality and the quality perception of the students studying at an English preparatory school of a foundation university in Turkey.
    Keywords: Quality, quality assurance, higher education, international accreditation
    Date: 2018–07

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