الإنفاق الاستهلاكي الخاص في المملكة العربية السعودية

Abstract EN

This study aims at selecting the most appropriate model for private consumption expenditure in the Kingdom of Saudi Arabia during the period from 1970 to 2015, based on an estimate of some of the different hypotheses of consumption functions in macroeconomic literature such as: absolute income hypothesis, relative income hypothesis, The life cycle hypothesis, and finally the habit formation hypothesis (Brown hypothesis).

This particular study is different from the other very few previous studies that have been conducted in this field and have been applied to the Kingdom of Saudi Arabia.

This is because it may able to use more consumption functions, considering observations for longer and newer time series, apply unit root tests to determine the stationary of study variables, take into account the demographic characteristics as indicated by economist Klein, finally, The Chow Test is applied to the appropriate model to see if there is a change in the behavior of private consumption expenditure before and after the Gulf War.

These considerations may contribute to a more accurate explanation of the behavior of private consumption expenditure in Saudi Arabia, and explain its nature and pattern in the past and present, which may allow it to be used to predict future private consumption of Saudi Arabia and thus develop policies and programs that stimulate rationalization within Saudi society And maintain its stability.

The study found that the hypothesis of absolute income is the most appropriate hypothesis for Saudi society.

Thus, the most important and influential factor in the behavior of private consumption in Saudi Arabia is income.

The other factors such as: permanent income, transitory income, and other factors, such as consumption for the previous period and wealth, have no effect.

Finally, the adoption of the Keynesian hypothesis contradicts the findings of the Nakadi and Hisham (1991) study, which stated that the two hypotheses that yield the best results are the relative income hypothesis and the life-cycle hypothesis