An Empirical Analysis of the Conditional Causality between Economic Growth, Inflation Rate and Oil Price: Evidence from Mena Countries

Abstract

This paper analyses the conditional causality during the 1970-2016'period between inflation rate and economic growth through the oil price evolution regarding eighteen MENA countries that are often touched by more or less recurrent armed conflicts. By making the difference between oil producing countries and non-oil producing countries, we notice that, in the oil producing countries, the causality, which goes from economic growth to inflation rate, is not governed by the oil price evolution while in the non-oil producing countries, the causality between economic growth and inflation rate is bidirectional and conditional to the oil price. Moreover, in the oil producing countries, armed conflicts influence negatively the economic growth but in the non-oil producing countries they do not have a significant impact on the economic growth and inflation rate as well.(original abstract)