Knowledge Economy and its Impact on Economic Growth and Per-Capita Income: Evidence from Arab Countries

Authors

Ahmad M. Khreisat, Knowledge Economy and its Impact on Economic Growth and Per-Capita Income: Evidence from Arab CountriesFollow
Nahil Saqfalhait, Department of Business Economics, Business college, University of Jordan, Amman, Jordan.Follow
Khawlah Spetan, Department of Business Economics, Business college, University of Jordan, Amman, Jordan.Follow
Raad M. Al-Tal, Department of Business Economics, Business college, University of Jordan, Amman, JordanFollow

DOI

10.35552/0247.38.11.2300

Abstract

Purpose: This study aims to analyze the development of the Global Knowledge Index (GKI) (published by the United Nations Development Program (UNDP) and Mohammed Bin Rashid Al Maktoum Foundation (MBRF)) for Arab countries according to their income levels and to assess the impact of the level of knowledge on economic growth and per capita GDP in Arab countries during the period (2017-2021). Methodology: The study covers a sample of the following Arab countries: (UAE, Qatar, Bahrain, Saudi Arabia, Kuwait, Oman, Jordan, Algeria, Lebanon, Tunisia, Egypt, and Morocco). Two econometric models were conducted using panel data based on the (GKI) reports: the first model estimates the impact of knowledge on GDP in Arab countries, while the second model estimates the impact of knowledge on GDP per capita for the same sample. Findings: Although the study results reveal a noticeable decline in the level of knowledge in the Arab countries at their various income levels during the study period, the best performance was positively associated with income level. It is also found that the level of knowledge is statistically significant and positively affects the gross domestic product; meanwhile, it does not have a statistically significant impact on per capita GDP. Conclusions and Recommendations: Several factors could explain why the knowledge index has a statistically significant impact on GDP growth, while no significant impact on per capita GDP in Arab countries; among them: high population growth, structural issues like unemployment and skill mismatches, heavy reliance on specific sectors such as oil and gas, income inequality, weak governance, and cultural barriers. The study recommends that Arab countries should direct their economies towards more reliance on knowledge which will be reflected positively in their economic growth. In addition to creating partnerships with the private sector to convert research and innovations into successful economic opportunities that increase the knowledge-added value.

Recommended Citation

Khreisat, Ahmad M.; Saqfalhait, Nahil; Spetan, Khawlah; and Al-Tal, Raad M. (2024) "Knowledge Economy and its Impact on Economic Growth and Per-Capita Income: Evidence from Arab Countries," An-Najah University Journal for Research - B (Humanities): Vol. 38: Iss. 11, Article 4.
DOI: 10.35552/0247.38.11.2300
Available at: https://digitalcommons.aaru.edu.jo/anujr_b/vol38/iss11/4