ORIGINAL ARTICLE
AN EMPIRICAL EVALUATION OF EXCHANGE RATES CHANGES: ECONOMIC IMPLICATIONS IN OIL-EXPORTING COUNTRIES
 
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College of Management, The University of Arizona, United States
 
 
Corresponding author
Abdullah AbdulRahman   

The University of Arizona, College of Management, The United States
 
 
Economic and Regional Studies 2019;12(2):111-126
 
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ABSTRACT
Subject and purpose of work: This paper examines empirical implications of exchange rates in the economy of the Kingdom of Saudi Arabia (KSA). In particular, it aims to identify and evaluate potential macroeconomic signs and symptoms of economic disturbance so as to determine macroeconomic variables that influence spot exchange rate (1GBP = SAR), and to examine how fixed exchange rate regime influences exports and imports in the Kingdom of Saudi Arabia (KSA). Materials and methods: Multiple regression and simple linear regression models were used to analyze the data from 1975 to 2018. Results: The study found a weak and insignificant relationship between spot exchange rate and unemployment rate, inflation rate, exports, and economic growth, along with strong relations with imports, investment, and current account variation in the KSA. Conclusions: The study recommends the adoption of a floating exchange rate regime in the KSA. It has revealed the signs and symptoms of increases of the inflation rate with decreasing exports, increasing imports, decreasing of current account (current account deficit threat), and small increases of investment.
 
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ISSN:2083-3725
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