The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation

Volume: 7 Number: 2 June 1, 2017
  • Abdulaziz Hamad Algaeed
International Journal of Economics and Financial Issues Cover
International Journal of Economics and Financial Issues
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The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation

Abstract

The purpose of this paper is to analyze theoretically and empirically the effects of a non-linear oil price shocks on Saudi investment-saving behavior for the period of 1985-2015, using structural vector autoregressive (SVAR) approach. The oil price shock is calculated as SOPI, employing GARCH (1,1). Johansen’s testing procedure result asserts the existence of stable long-run relationship between private saving investment (PI), oil price shock (OIL shock), government expenditure (GOEX) and per-capita income (PERCAPITA). The findings confirm that the oil price shocks affect positively (+) private investment. The sign is as expected and significant. Moreover, capital investment takes time to absorb the shock. Nonetheless, per-capita income as a proxy for aggregate demand had the right sign and statistically significant. Government expenditure had the positive sign reflecting the crowd-in effects. Although, Emmanuel, et al. (2014), found negative impacts of oil price shocks on private investment, our results should differ in sign because this analysis is forwarded towards an oil-exporting country.

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Primary Language

English

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Journal Section

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Authors

Abdulaziz Hamad Algaeed This is me

Publication Date

June 1, 2017

Submission Date

June 1, 2017

Acceptance Date

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Published in Issue

Year 2017 Volume: 7 Number: 2

IZ

https://izlik.org/JA38JE47RX

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RIS / Bibtex
APA
Algaeed, A. H. (2017). The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation. International Journal of Economics and Financial Issues, 7(2), 155-165. https://izlik.org/JA38JE47RX
AMA
1.Algaeed AH. The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation. IJEFI. 2017;7(2):155-165. https://izlik.org/JA38JE47RX
Chicago
Algaeed, Abdulaziz Hamad. 2017. “The Impacts of Non-Linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation”. International Journal of Economics and Financial Issues 7 (2): 155-65. https://izlik.org/JA38JE47RX.
EndNote
Algaeed AH (June 1, 2017) The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation. International Journal of Economics and Financial Issues 7 2 155–165.
IEEE
[1]A. H. Algaeed, “The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation”, IJEFI, vol. 7, no. 2, pp. 155–165, June 2017, [Online]. Available: https://izlik.org/JA38JE47RX
ISNAD
Algaeed, Abdulaziz Hamad. “The Impacts of Non-Linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation”. International Journal of Economics and Financial Issues 7/2 (June 1, 2017): 155-165. https://izlik.org/JA38JE47RX.
JAMA
1.Algaeed AH. The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation. IJEFI. 2017;7:155–165.
MLA
Algaeed, Abdulaziz Hamad. “The Impacts of Non-Linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation”. International Journal of Economics and Financial Issues, vol. 7, no. 2, June 2017, pp. 155-6, https://izlik.org/JA38JE47RX.
Vancouver
1.Abdulaziz Hamad Algaeed. The Impacts of Non-linear Oil Price Shocks on Saudi Savinginvestment Behavior: An Empirical Investigation. IJEFI [Internet]. 2017 Jun. 1;7(2):155-6. Available from: https://izlik.org/JA38JE47RX