Saudi Arabian economy and the Dutch disease: A recent look at a small open economy

The purpose of this thesis is to check for "Dutch Disease" in the Saudi Arabian economy over the period 1980--2001. Dutch Disease is the result of an exogenous increase in the price of that country's natural resource. Accordingly, a resource boom causes the output in the non-booming traded sectors to drop because of the "resource movement effect" and the "spending effect." Existing studies have found mixed results on the existence of Dutch Disease.;This thesis finds evidence of Dutch Disease in most of the non-oil traded sectors. Petroleum Refining was the only non-oil traded sector that had no evidence of the Dutch Disease. In the non-traded sector an increase in the Export Price Index causes the expansion of the Ownership of Dwellings sector while no evidence of the Dutch Disease was found across the rest of the sectors.