Abstract
We have developed in this study a simple model of income determination for the six member states of the Gulf Cooperation Council (GCC). In alphabetical order, these states are: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE). Through a two‐stage regression analysis, we obtained estimates of the demand function parameters and particularly of the marginal propensities to consume and import (MPC and MPM). Given 1975–97 data drawn from each of the six member states, we combined in the same regression the cross‐section and time‐series data and obtained thereby, at the GCC‐level, yearly estimates of MPC and MPM. These propensities yielded, in turn, annual estimates of the income multiplier. Through the multiplier, we assessed next the impact on national income of major autonomous variables, namely of oil export revenue, government services and investment.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
