Oil price volatility, Islamic financial development and economic growth in Gulf Cooperation Council (GCC) countries

Gazdar, Kaouthar; Hassan, M. Kabir; Safa, M. Faisal; Grassa, Rihab

doi:10.1016/j.bir.2018.07.005

Cited by 51 publications

(38 citation statements)

References 45 publications

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“…Best and Burke's (2018) findings confirmed the same conclusion while the results of Raheem et al (2016) encourage investors to increase their spending on enterprises. Gazdar et al (2018) focused their study on GCC countries over the period of 1996-2016. The fixed-effects model was used to analyse their data.…”

Section: Literature Reviewmentioning

confidence: 99%

“…From the recent studies, we can conclude the main hypotheses to be examined in this study as: 1). GDP Most studies agreed that there is a significant and positive correlation between the GDP and GDP per capita (Donou-Adonsou, 2019; Gazdar et al, 2018;Smaouia & Nechib, 2017). On the other side, some studies confirmed a negative relationship (Raheem et al, 2016;Flachaire et al, 2014).…”

Section: Hypotheses Formulationmentioning

confidence: 99%

“…The results of Iwanicz-Drozdowska (2019) show a significant and positive association between the GDP (production) and rules of law. However, some studies indicated insignificant correlations (Gazdar, 2018;Raheem et al, 2016). The hypothesis for rule of law is:…”

Section: Hypotheses Formulationmentioning

confidence: 99%

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Determinants of Economic Development: A Case of Gulf Cooperation Council (GCC) Countries

Alharthi¹

2019

IJEF

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The main objective of this research is to identify the determinants of economic development in Gulf Cooperation Council (GCC) countries over the period of 1996-2016. The economic growth of GCC countries has slowed down due to a sharp drop in oil prices as GCC countries are depending on oil exportation for their economies. The GCC countries preferred to diversify their economies through the strategic plans called Vision 2030. The Vision 2030 for Gulf countries started in Saudi Arabia in 26 April 2016 when the Crown Prince (Mohammad bin Salman Al-Saud) declared that Saudi Arabia has to not depend on oil exportation substantially and that the diversification of oil is a must. The economic growth can be measured through the gross domestic production (GDP). Higher GDP indicates a better economy and higher standards of lives (welfare). Based on this, this research is finding the main indicators of economic development through regressions of fixed-effects model (FEM), random-effects model (REM), generalized methods of moments (GMM) and generalized least squares (GLS) models. The results show that production and rule of law strongly support the economy. In contrast, political instability and a larger population impact economic growth significantly and negatively. In addition, the global financial crisis (GFC) also decreased the economic strength significantly. This study helps the policymakers in economics sector to focus on the positive determinants and to avoid (or reduce) the implementation of the negative factors. In addition, the researcher on economics can be benefited from this study.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Hypotheses Formulationmentioning

confidence: 99%

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Determinants of Economic Development: A Case of Gulf Cooperation Council (GCC) Countries

Alharthi¹

2019

IJEF

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“…Gazdar et al . () argued that oil price volatility and Islamic financial development has a significant positive effect on economic growth of GCC countries. Idrisov et al .…”

Section: Review Of Related Literaturementioning

confidence: 99%

“…So also, Sarwar et al (2017) found out that the link between oil price and economic growth is negative in full panel, upper-middle income, high-income, OECD, East Asia and Pacific, Latin America and Caribbean and Sub-Saharan Africa region, but there is a positive relationship between oil price and economic growth in low-middle and South Asian region. Gazdar et al (2018) argued that oil price volatility and Islamic financial development has a significant positive effect on economic growth of GCC countries. Idrisov et al (2015) observed that in Russia oil price variations has a significantly impact oneal gross domestic product (GDP) in the short-run, while in the longrun, the impact is insignificant.…”

Section: Review Of Related Literaturementioning

confidence: 99%

The impact of oil price and revenue variations on economic growth in Nigeria

2018

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The study investigates the relationship between oil price, revenue variation and economic growth in Nigeria. The study makes use of a secondary data spanning 1981 and 2016. The Auto‐regressive Distributed Lag was used to analyse the long‐run and short‐run relationship among the variables. The short‐run result shows that oil price and oil revenue positively significantly relates with economic growth, while consumer price index and exchange rate negatively relates with economic growth. In the long‐run, oil price, consumer price index and exchange rate positively relates with economic growth, while oil revenue negatively relates with economic growth. This implies that oil revenue has not been channelled in the direction of enhancing growth in Nigeria, while oil price has been in favour reason been that it determines a larger percentage of the country's revenue. From the findings, the study concludes that variations in oil price and oil revenue are strong determinant factors of economic growth in Nigeria. A major recommendation is that, oil revenue should be restructured towards the strategic sectors of the economy to aid the growth in Nigeria.

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Does competition lead to financial stability or financial fragility for Islamic and conventional banks? Evidence from the GCC countries

et al. 2020

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This paper investigates the nexus between stability and competition in the banking sector of the Gulf Cooperation Council. We examined a sample of 75 banks over the period 2006–2016. We found a U‐shaped relationship between bank stability and competition suggesting competition‐stability and competition‐fragility nexus. Banking concentration was found to affect instability negatively, which supported the “too important to be bailed out” view. Furthermore, we found that Islamic banks were less stable compared to conventional banks. We also found that bank size, profitability and capital regulation increase bank stability. In addition, the stock market return and the level of debt‐to‐GDP increase instability while the growth in oil price increase stability. Our findings are relevant to regulators to impose or release restrictions that boost financial stability.

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Oil price volatility, Islamic financial development and economic growth in Gulf Cooperation Council (GCC) countries

Cited by 51 publications

References 45 publications

Determinants of Economic Development: A Case of Gulf Cooperation Council (GCC) Countries

Determinants of Economic Development: A Case of Gulf Cooperation Council (GCC) Countries

The impact of oil price and revenue variations on economic growth in Nigeria

Does competition lead to financial stability or financial fragility for Islamic and conventional banks? Evidence from the GCC countries

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