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What Can Drive Socioeconomic Development in MENA High Income ‎and Upper-Middle-Income Countries? A Panel Causality Analysis

NEIFAR, MALIKA and Smaoui, Fatma (2025): What Can Drive Socioeconomic Development in MENA High Income ‎and Upper-Middle-Income Countries? A Panel Causality Analysis.

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Abstract

This study investigates the short- and long-run causality linkages between the socioeconomic ‎development (SED) measured by the GNI per capita and 4 groups of selected factors ‎including information and communications technology (ICT), political, demographic, and ‎macroeconomic indicators in a panel of 19 countries classified as High Income (HIC) ‎countries or Upper-Middle-Income countries (UMIC) from MENA zone between 2008-2021. ‎For comparison analysis between groups/countries, the research design is based on three ‎Granger non causality tests type. The first is the (Dumitrescu & Hurlin, 2012) panel non-‎causality test, the second is the panel VAR Block Exogeneity Wald Tests, and the third is the ‎panel ARDL ECM-based Granger non causality tests. The results suggest that each group of ‎the considered factors is a predictor with effects depend on the type of factors or the income ‎level of the country. Based on the descriptive analysis and more sophisticated econometric ‎techniques, the difference is obvious in the short- and long-term. Indeed, in the short-run, ‎besides agriculture indicator, the GNI for each group is affected by at least one of the ICT ‎indicators in addition to tourism for the HIC and demographic and political factors for the ‎UMIC. In the long-run, GNI is caused by demographic factors for HIC (except for Kuwait ‎and Libya) and economic factor (except for Oman), ICT factors for Iran, Kuwait, Oman, and ‎Lebanon and all UMIC except Jordan. In addition, the political (demographic) factors for ‎Lebanon, Saudi Arabia, and Turkey (for all UMIC except Syria), and the economic (political) ‎factors for Jordan, Egypt, and Tunisia (Algeria and Morocco) contribute to the GNI ‎prediction in the long-run. The findings come in help for Governments and policymakers to ‎adjust their policies and to design the most adequate policy according to the causality linkages ‎between GNI and the selected factors.‎

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