Economies Of East Research Articles

Internet Banking Adoption in Saudi Arabia: An Empirical Study

The current study was conducted with the primary objective to explore the factors and analyse their relevance and importance in the adoption of internet banking in Saudi Arabia. In this paper, we gathered evidence from 300 consumers about the factors they considered important before opting for internet banking. Responses were collected by administering a Likert scale close ended structured questionnaire. Factor analysis was conducted to group the factors into significant components areas. The results showed that the factors under study explained 91.508% of the variance in internet banking adoption. Also, that the trust is the most crucial factor for the consumers of internet banking (25.950% variance) followed by ease of using internet banking services (25.188% variance); whereas 21.921% variance explained efficiency and effectiveness of the internet banking and 18.449% variance explained the importance of information about the internet banking to the consumers. The findings of this study will allow the banks to develop internet banking strategies tailored to the expectations of their clients. The study recommends banks to focus on building the trust of the customers and should also make internet banking as convenient as possible. Besides, the internet banking should be efficient and effective in delivering banking services. Furthermore, there should be sufficient information available regarding internet banking. Saudi Arabia is the largest economy in the Middle East. Of late the country has focused on the modernisation of its economy and has been trying in earnest to integrate with the world economy. The e-commerce activities are also growing; however, research in internet banking is limited. The findings of the paper can serve as a model for the adoption of internet banking especially in Saudi Arabia and in the Middle East or elsewhere in general. The research was conducted in Saudi Arabia, and more researches could be conducted based on this study in other parts of the Middle East for more generalisation of the findings.

The development of accounting practices and the adoption of IFRS in selected MENA countries

PurposeThe purpose of this paper is to examine the level of accounting development and the adoption of IFRS in the four foremost economies in the Middle East and North Africa (MENA)—Egypt, Jordan, Libya and UAE. Through the lens of institutional theory, the study investigates the impact of economic, political, legal and cultural institutions on the development of these countries’ accounting practices and their readiness to use IFRS.Design/methodology/approachThis research uses accounting development indices obtained from current literature as well as recent World Economic Forum and UNCTAD reports to examine the development of accounting in these MENA countries and their inclination to adopt IFRS.FindingsThe study identifies a number of impediments to the development of accounting practices and adoption of IFRS in these countries. It also reveals that three of the four MENA countries (Egypt, Jordan and UAE) could be placed on a level playing field with their principal trading partners (the US, the UK, Germany and Italy) given the formers’ business environments, methods of raising finance and levels of professional accounting practices.Research Implications/limitationsAlthough limited to only four jurisdictions, findings from the study have important implications for investors and parties that are interested in improving the value relevance of the information presented by firms especially in a globalised economy with increasing cross-listing.Originality/valueThis study extends the frontier of knowledge on the development of accounting and IFRS adoption by focusing on the MENA region. It is the first effort that the authors are aware of to adopt such a multifarious approach.

Arms and Oil in the Middle East: A Biography of Research

This essay interweaves two stories—one theoretical and empirical, the other autobiographical. The first story embeds the Israeli-Palestinian conflict in the broader political economy of the Middle East and the global accumulation of “capital as power.” The second story narrates the authors’ personal journey to uncover, theorize, and research this enfoldment. The essay explores and contextualizes the misleading duality of politics and economics; the link between military spending, finance, and stagflation; the concepts of “dominant capital” and “differential accumulation” and their evolution through “breadth” and “depth”; the manner in which these concepts and processes inform the political economy of Israel and the Israeli-Palestinian conflict; and the ways in which they help identify the key role of the Weapondollar-Petrodollar Coalition and predict the periodic eruption of Middle East “energy conflicts.” In their explorations, the authors have encountered numerous gatekeepers who tried to derail their research as well as a few open-minded editors who sought to promote it, and it is probably fair to say that, dialectically, they have benefited from both.

System and Neural Network Analysis of Economic and Financial Development – A case study of Dubai and rest of UAE

The study examines the factors affecting the economic and financial development by applying Zellner’s seemingly unrelated regressions (SURE) and Neural Network techniques. It applies multivariate and neural network frameworks for analysing the GDP of Dubai and rest of UAE using data for 2001–2015. The study shows that there exists positive interdependencies between Dubai and rest of UAE economies. This signifies that the core competencies across various sectors in Dubai and rest of UAE economies need to be promoted further to have overall diversified impact on UAE economy. The positive sizable impact of the finance sector in Dubai and negative sizable impact in the rest of the UAE provide many opportunities for designing diversification programs for sustained economic development of the entire UAE economy. The small sample size, non-availability of detailed sectoral data in four of the seven emirates constrained the scope of the study for generalization to other economies in the Middle East. The study findings are crucial for identifying structural reforms, to strengthen competitiveness and accelerate private sector-led job creation for nationals, potential on further opening up foreign direct investment (FDI), improving selected areas of the business environment, and easing access to finance for start-ups and SMEs in both the economies.
 JEL: C32, C52, D85, N15, N25

Transition economies in the Middle East: the Syrian experience

There have been no in-depth studies of the post-socialist transition in the Middle East. Syria’s experience is a useful one to explore given its historically important role in the region and its distinctive characteristics. The Syrian economic transition, from the early 1990s to 2011, was in two phases: an incremental liberalisation phase and a transition to a social market economy phase. During both phases, Syrian policymakers showed a preference for a gradualist approach to economic transition, rather than a big-bang approach. This was facilitated by oil revenues and subsidies from the Gulf States. The Syrian experience therefore has its own distinct characteristics, as well as elements in common with the transitions in other post-socialist economies.

Population Aging and the Possibility of a Middle-Income Trap in Asia

ABSTRACTWe present three conditions for a demography-driven middle-income trap and show that many economies in East, South, and Southeast Asia satisfy all of them. The conditions involve (1) the support ratio of workers to consumers has an impact on economic growth, (2) economic development accompanies more investment in human capital and lower fertility due to the quantity–quality trade-off, and (3) a current low level of fertility corresponds to very low support ratios for keeping up with frontier economies in the long run. Panel analysis for 178 countries shows that (1) and (2) are satisfied for Asia with higher elasticity than others. As for (3), we set up a dynamic model for simulations, showing that approximately two-third of Asia’s developing countries have an unsustainable level of support ratios, implying possibility of a middle-income trap due to future demographic headwinds.

Population Aging and the Possibility of a Middle-Income Trap in Asia

We present three conditions for a demography-driven middle-income trap and show that many economies in East, South, and Southeast Asia satisfy all of them. The conditions are (1) support ratio—the ratio of workers to consumers—matters for economic growth, (2) economic development accompanies more investment in human capital and lower fertility due to the quantity–quality trade-off, and (3) current low level of fertility corresponds to too low support ratios for keeping up with the frontier economies in the long run. The panel analyses for 178 countries, among which 30 are ADB developing member economies, show that (i) and (ii) are satisfied for Asia with higher elasticity than others. As for (iii), we set up a dynamic model for simulations, showing that about two-thirds of ADB members have unsustainable level of support ratios, implying possibilities of a middle-income trap due to demographic headwinds in the future.

About the Contributors

About the Contributors

Economic risk linkages between Israel and middle east countries

This study analyses the economic risk relationship between seven of the top economies in the Middle East and Israel. Our findings are of great interest and likely to begin a new debate in the Middle East region. The results of a block exogeneity Wald test reveal that economic stability in Israel does Granger-cause economic stability in Lebanon, Oman, Qatar and the UAE. Reverse causality has been validated for Lebanon and Bahrain only. We also find that there is a positive impact on Israel?s economic stability over the stability of Bahrain, Kuwait and the UAE with different seasonal patterns. In the reverse direction, in response to a shock to Israel?s economic stability, the stability of the UAE, Saudi Arabia, Oman, and Kuwait are also found to be positive and significant with different seasonal frequencies.

Evaluating the Impact of Trade Openness on Women’s Job Opportunities : An Analysis for Middle East Countries = تقييم أثر الانفتاح التجاري على فرص عمل المرأة : تحليل لدول الشرق الأوسط

Trade Openness | Women’s Absolute Employment Rate | Female Labor Force | Gender Gap | Middle East Economies | الانفتاح التجاري | معدل العمالة المطلقة للمرأة | قوة العمل النسائية | الفجوة بين الجنسين | اقتصادات الشرق الأوسط

Sectoral Evaluation for Economic and Financial Development in Dubai and rest of UAE

The paper examines sector specific characteristics to analyse the factors affecting the sustainability of the economies of Dubai and rest of the United Arab Emirates (UAE).
 The study applies system design to analyse the research questions. Consequently, Zellner’s seemingly unrelated regressions (SURE) technique is used to examine the relative contribution of sectors to the economies Dubai, as an individual Emirate, and the rest of UAE as a group of Emirates using time series sectoral level data for 2001–2015.
 The study shows that there exists positive interdependencies between Dubai and rest of UAE economies. This signifies that the core competencies across various sectors in Dubai and rest of UAE economies need to be promoted further to have overall diversified impact on UAE economy.
 The positive sizable impact of the finance sector in Dubai and negative sizable impact in the rest of the UAE provide many opportunities for designing diversification programs for sustained economic development of the entire UAE economy. The small sample size, non-availability of detailed sectoral data in four of the seven emirates constrained the scope of the study for generalization to other economies in the middle east.
 
 The study findings are very crucial for identifying structural reforms, to strengthen competitiveness and accelerate private sector-led job creation for nationals, potential on further opening up foreign direct investment (FDI), improving selected areas of the business environment, and easing access to finance for start-ups and SMEs in both the economies.
 There are very few studies, which have researched the sector specific characteristics to explain the factors affecting the sustainability of the economies of Dubai and the rest of UAE. The study provides insights to the UAE policy makers, for enhancement of policies through development of the key sectors that influence the performance of the two economies. Despite being independent entities though, the seven emirates of the UAE are economically interdependent. Studies on such interactions add unique value to the literature.
 Keywords: SURE, GDP, Dubai, UAE, Sectoral Evaluation, Financial development.

The Far East

This article presents a critical overview of the achievements of the Russian government’s current Far East policy and focuses on the realization of targeted programs, the creation of priority social and economic development areas and the free port of Vladivostok, and the distribution free of land. The economic and institutional characteristics of the development of the Russian Far East economies are analyzed. The potential effectiveness of current Far East economic policy is considered and compared with the experience of other countries with high rent in their economies. Finally, the article argues that government policies accelerate regional development only when they are built into a general policy for reducing risk in the national economy.

The Russian Far East

This article describes the course and results of the development of the Russian Far East, considers the institutional and material conditions of the Far East economy at various stages of its economic and political history, and discusses the correlation of economic and geopolitical priorities during the pursuit of regional development. Several changes in the conception of development are highlighted. The article also considers the ratio of “infrastructure modernization” and the enactment of regional endogenous, social, and economic development. Finally, the potential of maintaining economic and social development in the Far East without “extraordinary” institutional and financial regimes is analyzed.

Family as a Socio‐economic Actor in the Political Economies of East and South East Asian Welfare Capitalisms

AbstractIn this article, we revisit Karl Polanyi's concept of ‘oikos’ in order to reconceptualize the role of the family as both a welfare provider and an economic actor in the social reproduction of East and South East Asian welfare capitalisms. Our article is structured in four parts. First, we critically review existing approaches on the characteristics of welfare capitalism in East and South East Asia. We argue that existing approaches tend to isolate family as a welfare provider and neglect how the role of the family is institutionalized as a collective actor. The second part focuses on the role of the family in the social reproduction of welfare capitalism, and explores how, in East and South East Asia, the specific conditions for family's role as an economic actor were institutionalized historically. The third part revisits Polanyi's concept of ‘oikos’ and how ‘householding’ constitutes one of the most important forms of economic action allowing us to examine the family as a socio‐economic actor. In the fourth section, we provide an analysis of families' available strategies and discuss evidence related to private education expenditure, household debt and labour market income share. We conclude by highlighting the need to re‐articulate the importance of family as a collective socio‐economic actor that, despite recent reforms and path departures, remains at the epicentre of East and South East Asian welfare capitalisms.

Book Review: Milani Commett, Ishac Diwan, Alan Richards, and John Waterbury (2015). A Political Economy of the Middle East

Book Review: Milani Commett, Ishac Diwan, Alan Richards, and John Waterbury (2015). <i>A Political Economy of the Middle East</i>

Amir M. Kamel , The Political Economy of EU Ties with Iraq and Iran: An Assessment of the Trade–Peace Relationship, The Political Economy of the Middle East (New York: Palgrave Macmillan, 2015). Pp. 241. $115.00 cloth. ISBN: 9781137439796

Amir M. Kamel , The Political Economy of EU Ties with Iraq and Iran: An Assessment of the Trade–Peace Relationship, The Political Economy of the Middle East (New York: Palgrave Macmillan, 2015). Pp. 241. $115.00 cloth. ISBN: 9781137439796 - Volume 49 Issue 2

Transformation from an Oil-based Economy to a Knowledge-based Economy in Saudi Arabia: the Direction of Saudi Vision 2030

The central aim of this article is to explore issues related to the transformation of an oil-reliant economy to a knowledge economy in Saudi Arabia, a country which witnessed a remarkable revolution following the discovery of oil more than three quarters of a century ago (March 1938). The study provides insights into what the country’s knowledge economy looks like today and the potential policy issues related to how the economy might evolve into the future. Saudi Arabia, a member of G20, is the world’s largest oil exporter and derives about 90% of the government revenue from oil. Based on the documentary analysis (World Bank, United Nations, World Economic Forum, Ministries in Saudi Arabia and newspapers), the findings of this study suggest that there are six key aspects which need to be considered in developing Saudi Arabia’s knowledge economy: human capital, innovation, information and communications technology (ICT), the economy, education and employment. In particular, several challenges are identified relating to human capital, research and unemployment amongst university-educated females. The Saudi government’s Vision (Arabic: 2030 and the related National Transformation Program 2020 both stress the importance of diversifying the economy through development of the knowledge economy. The findings of this study will assist policymakers as they work to create sustainable knowledge economy framework for Saudi Arabia. Further research is required to compare the pillars of the knowledge economy in the Middle East.

Political enthusiasm for social pensions and its eventual decline in Taiwan: an institutional account of pension dynamics in a new democracy

ABSTRACTOver the last two decades, there has been a remarkable transformation of the demography and political economy of East and Southeast Asia, thus raising pensions as an important policy issue. In addressing the pension needs of those outside formal sector employment, Taiwan was the regional forerunner regarding social pension provision. However, the immense political popularity of these schemes waned and from the mid-2000s onwards the government began to substitute them with a contributory system for the socially disadvantaged. This paper analyses the political dynamics of social pensions in Taiwan, from expansion of coverage through to gradual dismantlement. The politics surrounding these benefits has received scant attention in international scholarship, with the World Bank and the Asian Development Bank Institute, in particular, having focused most of their attention on policy design issues. The contention here is that a specific configuration of political factors featured prominently in Taiwan, thus providing an explanation for the evolution of its pension policy. Also, these political dimensions can shed light on how this type of pension could evolve in other East and Southeast Asian countries, which is pertinent given that many have increasingly ageing populations.

Agriculture and Development in the Wake of the Arab Spring

This paper analyses the role of agriculture in the political economy of the Middle East and North Africa (MENA). It outlines agriculture’s relative contribution to development and employment, shows linkages with food security policies, and discusses possible future scenarios. Agriculture’s role in the economies of MENA is limited nowadays, but its contribution to employment is still substantial. In many countries it is at the heart of the region’s water crisis as it withdraws about 80 per cent of water resources. Agricultural constituencies have played an important role in sociopolitical transformations of the region. Populist regimes tried to win them over—as support base—with land reforms enacted in the 1950s and 1960s. Since the 1980s these earlier reforms have been pushed back and the sector has been liberalised under bureaucratic-authoritarian reform coalitions. In other countries, such as Saudi Arabia, extensive production subsidies have been maintained. The MENA region is the largest cereal importer in the world and its governments regard this dependency as a strategic liability. However, the quest for self-sufficiency has proven to be elusive in the light of natural constraints and population growth. The major challenge in MENA is not macro food security or lack of calories, but deficiencies of micronutrients such as vitamins and iron and a lack of accessible food for the poor. Hence, inclusive growth, rural livelihood strategies, and political participation will be crucial for food security in MENA.

Review of Global Shock, Risks, and Asian Financial Reform

Global Shock, Risks and Asian Financial Reform. Edited by Iwan J. Azis and Hyun Song Shin. Cheltenham, UK and Northampton, USA: Asian Development Bank and Edward Elgar Publishing, 2014. Pp. 731. Since the 2007-08 Global Financial Crisis (GFC), there have been many books written on the future of Asian finance and financial reform. This book, edited by Iwan J. Azis and Hyun Song Shin from the Asian Development Bank (ADB)/ Cornell University and Princeton University respectively, is the most comprehensive and in-depth study of the issues facing Asian finance to date. A hefty volume of over 700 pages and 18 chapters, written by ADB specialists, leading academics and financial policymakers, it deserves serious attention. Professor Shin has since moved to become the Economic Adviser and Head of Research at the Bank for International Settlements, helping to shape one of the most creative research agendas on current global finance, monetary and regulatory policy. The book comprises five parts: an introductory overview and summary by the editors; macro-prudential supervisory system and development impact; issues and challenges for the legal and institutional framework; (regional) financial integration and cooperation to support financial stability; and financial supervision and development challenges. Each section has an introduction with an overview of the findings and issues raised. The book is the outcome of an ADB research project on regulatory reform post-GFC and is very useful as a compendium and reference on regulatory issues for Asia up to 2012. The book focuses mostly on East Asia (particularly ASEAN countries). In contrast, South Asia and the Middle East economies are not given as much attention as they deserve. The overview in Part I by Azis and Shin provides a very useful summary but lacks a historical perspective, which begs a simple yet strategic question: as Asia evolves from the world's global supply chain to become a net lender through high savings and surplus, can it develop its own financial sector to better use its savings? Currently, the region suffers from exporting excess savings to advanced markets in London and New York and re-importing these back through foreign direct investments and portfolio flows that earn significantly higher returns. The region is also hostage to volatile capital flows and both India and China still maintain capital controls. How Asia manages its financial sector, particularly the difficult transition to totally open capital markets, will define its role in global leadership in the twenty-first century. In other words, the book takes the orthodoxy as given, recognizing that financial deepening is broadly good, albeit with risks to be managed. Even though it recognizes that there is no one-size-fits-all regulation or regulatory structure, it hints at current advanced markets--dominated by American and European thinking--as a model for Asia. The field of finance moves so rapidly that since the book was written, four major trends and events have turned and are turning the industry almost upside down. First, macroeconomic theory and finance is being challenged by central banks' unconventional monetary policy of moving interest rates beyond the lower boundary of zero. The spillover effects of such a move on financial markets and investor behaviour are still being digested and the outcome is highly uncertain. All that can be said is that savers recognize that they are being taxed indirectly, but steps made to adjust their portfolios remain to be seen. Second, financial technology platforms are challenging the payments, investment and transaction profits of traditional banks, insurance companies and asset managers. Their market valuation is currently worth more than the market capitalization of the largest banks. Third, as the implementation of the complex regulatory and legal reforms introduced post-GFC is being phased in, there has been some unexpected impact on market behaviour, such as flash crashes, high volatility and sudden liquidity stops. …