Topics in Middle Eastern and North African Economies

Document Type

Article

Publication Date

9-1-2016

Abstract

In this paper, we attempt to analyze, during the period spanning from January 2000 to July 2015, the impact of oil price shocks on inflationand the real exchange rate in a set of oil importers and exporters MENA countries: Tunisia, Morocco, Algeria, Bahrain, Saudi Arabia and Iran (MENA-6) using a Structural VAR model. The impulseresponse functions reveal that, in the long run, oil price fluctuations havethe major impact on real exchange rate of the oilimporting countries (Tunisiaand Morocco) while the impact on inflation is smaller and absorbed by the rigidity of subsidized products prices. The variance decomposition results also assertthat oil price shocks do not explain notably thevariation in the twoconsidered variables in Algeria and Iran.We further identify an impact on the two variables that is both statistically significant and economically large in the rest of countries.

Journal Title

Topics in Middle Eastern and North African Economies

ISSN

2334-282X

Publisher

Middle East Economic Association and Loyola University Chicago

Volume

18

Issue

2

Comments

Presentation of the articles in the Topics in Middle Eastern and North African Economies was made possible by a limited license granted to Loyola University Chicago and Middle East Economics Association from the authors who have retained all copyrights in the articles.

Creative Commons License

Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

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