The Impact of Oil Prices on the Global Competitiveness of National Economies

Abstract

The influence of various factors on the competitiveness of national economies is investigated in many articles, however, there is little research on the impact of resource prices on it. This article aims to examine the effect of crude oil prices on the global competitiveness of both producing countries and countries consuming oil. Based on annual data from 60 countries for 2006-2017, a regression analysis of panel data with fixed effects shows that exceeding the annual growth rate of oil prices over gross domestic product growth rates reduces the growth rate of the global competitiveness index (GCI), and it is twice strong for oil exporting countries than for countries non-oil exporters. And the growth of average labor productivity, total factor productivity, the share of employed in the total population, High-technology exports, and the Gross capital formation raises the country's GCI. Due to the rise in world oil prices, exporting countries are moving downward in the global competitiveness ranking more than non-oil exporters.

Impact of Oil Factor on Consumer Market: The Case of Azerbaijan

“…Based on annual data for the years 2006-2017, the researchers studied the impact of crude oil prices on global competitiveness in 60 oil-producing and oil-consuming countries by conducting fixed -effect panel data regression analysis and concluded that the annual growth rate of oil prices is higher than GDP growth. increasing the rate of growth more than doubles the growth rate of the Global Competitiveness index for oil-exporting countries compared to non-oil-exporting countries (Mukhamediyev and Temerbulatova, 2019). Mukhtarov et al (2019) investigated the effect of oil prices on economic growth, exports, inflation and exchange rate in Azerbaijan using Johansen cointegration and VECM methods based on the data covering the years 2005:01-2019:01 and came to the conclusion that the variables there is a long -term relationship between the impulse response and results decomposition tests show that oil prices have a positive and statistically significant effect on economic growth, exports and inflation, on the other hand, oil prices have a negative effect on the exchange rate.…”

The partnership of governments for sustainable development

“…It will be imperative to lift the level of private finance and investment in the SDGs in all countries, especially low-and middleincome countries with rising populations. This includes both portfolio investment and direct investment, both domestic and foreign [13]. It also contains mobilizing private sector expertise and scaling capabilities, ranging from science, operational capacities, technological and research skills to the innovation, implementation of business.…”

The static and dynamic effects of oil rent on competitiveness: Application to the case of Saudi Arabia during the period 1970–2022

“…Consequently, non-oil competitiveness decreases and reduces the penetration rate of national products in the world economy. Mukhamediyev and Temerbulatova (2019) stated that when oil prices increase it allows countries to gain a financial surplus which can encourage economic decisionmakers to postpone economic reforms required to improve competitiveness. On the other hand, these surpluses can contribute to the reduction of the global competitiveness index, especially if these massive inflows of petro dollars will be spent on the acquisition of imported consumer goods.…”