This research program will provide a framework for managing stabilization and sovereign wealth funds in oil-dependent economies, to achieve economic stability and sustainability. Focusing on Saudi Arabia, it will balance maximizing the welfare of households with a focus on the economy.
There are three main problems associated with oil-dependent economies: Oil revenues are highly volatile and uncertain; it is a non-renewable resource. Hence it provides unsustainable streams of revenues. Oil production is a capital-intensive industry generating fewer jobs compared to other manufacturing industries.