Non-Financial Determinants and economic fluctuations – evidence from Yemen

Abstract

PurposeThis paper aims to examine, by way of an analytical research review, the reasons for the fluctuations in the economic growth of the country of Yemen during the period from 2000 to 2014. The authors are trying to generate the answers to the following questions: Has tourism, oil price, politically instability improved? What is the impact of tourism, oil price and politically instability on economic growth before and after turbulence time? We have found that very low number of papers have written about the topic. Yemen, as a developing country, has been under the influence of an turbulence time. The term “turbulence time” refers to the series of independent uprisings that occurred in 2010 across the Arab world. There is a lack of understanding concerning the economic growth status in the existing literature during this period.Design/methodology/approachThe authors use vector error-correction model to examine the impact of candidate variables .This review and analysis could provide an additional understanding in terms of the factors contributing to economic growth in Yemen; particularly before and after the turbulence time.FindingsDespite oil prices having appreciated and the unemployment rate having improved, particularly after the Arab Spring, political instability has dominated the scope of determinants for economic growth in Yemen. To address the objective of this study.Originality/valueThis paper provides an additional reference about the economic status of Yemen.