nep-ara New Economics Papers
on MENA - Middle East and North Africa
Issue of 2019‒04‒01
four papers chosen by
Paul Makdissi
Université d’Ottawa

  1. The Changing Geopolitics in the Arab World: Implications of the 2017 Gulf Crisis for Business By Jamal Bouoiyour; Refk Selmi
  2. Returns to Investment in Education: The Case of Turkey By Patrinos, Harry Anthony; Psacharopoulos, George; Tansel, Aysit
  3. Identifying Credit Supply Shocks in Turkey By Tayyar Buyukbasaran; Gokce Karasoy Can; Hande Kucuk
  4. Determinants of the Rise in Female Labor Force Participation: Identifying Cohort Effects By Altan Aldan; Selcen Ozturk

  1. By: Jamal Bouoiyour (CATT - Centre d'Analyse Théorique et de Traitement des données économiques - UPPA - Université de Pau et des Pays de l'Adour, IRMAPE - Institut de Recherche en Management et Pays Emergents - ESC Pau); Refk Selmi (CATT - Centre d'Analyse Théorique et de Traitement des données économiques - UPPA - Université de Pau et des Pays de l'Adour, IRMAPE - Institut de Recherche en Management et Pays Emergents - ESC Pau)
    Abstract: The international community was caught by surprise on 5 June 2017 when Saudi Arabia, the United Arab Emirates (UAE), Bahrain and Egypt severed diplomatic ties with Qatar, accusing it of destabilizing the region. More than one year after this diplomatic rift, several questions remain unaddressed. This study focuses on the regional business costs of the year-long blockade on Qatar. We split the sample to compare the stock market performances of Qatar and its Middle Eastern neighbors before and after the Saudi-led Qatar boycott. We focus our attention on the conditional volatility process of stock market returns and risks related to financial interconnectedness. We show that the Gulf crisis had the most adverse impact on Qatar together with Saudi Arabia and the UAE. Although not to the same degree as these three countries, Bahrain and Egypt were also harmfully affected. But shocks to the volatility process tend to have short-lasting effects. Moreover, the total volatility spillovers to and from others increase but moderately after the blockade. Overall, the quartet lobbying efforts did not achieve the intended result. Our findings underscore Qatar's economic vulnerability but also the successful resilience strategy of this tiny state. The coordinated diplomatic efforts of Qatar have been able to fight the economic and political embargo.
    Keywords: 2017 Gulf crisis,stock markets,volatility,risk spillovers
    Date: 2019–03–10
  2. By: Patrinos, Harry Anthony; Psacharopoulos, George; Tansel, Aysit
    Abstract: This paper estimates private and social returns to investment in education in Turkey, using the 2017 Household Labor Force Survey and alternative methodologies. The analysis uses the 1997 education reform of increasing compulsory education by three years as an instrument. This results in a private rate of return on the order of 16 percent for higher education and a social return of 10 percent. Using the number of children younger than age 15 in the household as an exclusion restriction, the analysis finds that returns to education for females are higher than those for males. Contrary to many findings in other countries, private returns to those working in the public sector are higher than those in the private sector, and private returns to those who followed the vocational track in secondary education are higher than those in the general academic track. The paper discusses the policy implications of the findings.
    Keywords: Education, Returns to Education, Turkey
    JEL: I21 J24
    Date: 2019–03–23
  3. By: Tayyar Buyukbasaran; Gokce Karasoy Can; Hande Kucuk
    Abstract: This paper aims to identify credit supply shocks and analyse their macroeconomic effects in Turkey. For this purpose, we use a Bayesian Structural Vector Autoregression (SVAR) with sign and zero restrictions. We focus on the impact of credit supply shocks on real GDP growth and highlight how the size of this impact changes when we explicitly account for the effects of capital inflows on credit conditions. Hence, our results confirm the importance of external finance for credit supply in Turkey. Our main findings are robust to some alternative data choices, prior selections as well as some alternative identifying restrictions.
    Keywords: Credit supply shocks, SVAR, Bayesian VAR, Sign and zero restrictions
    JEL: C11 C32 E52 F41
    Date: 2019
  4. By: Altan Aldan; Selcen Ozturk
    Abstract: Female labor force participation rate in Turkey is quite low but is rapidly increasing. This study analyzes the determinants of this rise. The study focuses on the birth cohort effects on female labor force participation. Cohort effects can be considered as a proxy for the effects of changes in societal values or institutional setting on female labor force participation. The study finds cohort effect as the main determinant of recent rise in female labor participation. Improvements in educational attainment and decline in fertility are other important factors. On the other hand, there is no decrease in the negative effect of having children on female labor force participation.
    Keywords: Female labor force participation, Cohort effects
    JEL: J11 J21
    Date: 2019

This nep-ara issue is ©2019 by Paul Makdissi. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.