66 results

Analyzing the Effects of Saudi Arabia’s Economic Reforms Using a Dynamic Stochastic General Equilibrium Model

Analyzing the Effects of Saudi Arabia’s Economic Reforms Using a Dynamic Stochastic General Equilibrium Model

Jorge Blazquez, Marzio Galeotti, Baltasar Manzano, Axel Pierru, Shreekar Pradhan

Saudi Arabia is the world’s second-largest holder of proved oil reserves and the second-largest producer of petroleum liquids. The country is the largest exporter of crude oil, with a share of 16% of total crude oil exports in 2017. Saudi Arabia’s…

Jorge Blazquez Blazquez, Jorge
Marzio Galeotti Galeotti, Marzio
Baltasar Manzano Manzano, Baltasar
Axel Pierru Pierru, Axel
Shreekar Pradhan Pradhan, Shreekar
May 21, 2020
Implementing Alternative Pricing Policies in Economic Equilibrium Models Using the Extended Mathematical Programming Framework
Regional Energy Markets

Implementing Alternative Pricing Policies in Economic Equilibrium Models Using the Extended Mathematical Programming Framework

Bertrand Rioux, Abdullah AlJarboua, Frederic Murphy, Axel Pierru

Standard economic optimization models represent markets in perfect competition. They are commonly used, though they may not accurately represent real-world policies and regulations. Equilibrium models built using a mixed complementarity problem (MCP) approach are capable of simulating more flexible pricing…

Bertrand Rioux Rioux, Bertrand
Abdullah AlJarboua AlJarboua, Abdullah
Frederic Murphy Murphy, Frederic
Axel Pierru Pierru, Axel
March 12, 2020
K-DSGE: A Dynamic Stochastic General Equilibrium Model for Saudi Arabia

K-DSGE: A Dynamic Stochastic General Equilibrium Model for Saudi Arabia

Jorge Blazquez, Marzio Galeotti, Baltasar Manzano, Axel Pierru, Shreekar Pradhan

This paper describes a dynamic stochastic general equilibrium (DSGE) model of the Saudi Arabian economy, developed by KAPSARC researchers. The K-DSGE model is to be used for simulations and experiments to assess the impact of economic reforms within the Saudi…

Jorge Blazquez Blazquez, Jorge
Marzio Galeotti Galeotti, Marzio
Baltasar Manzano Manzano, Baltasar
Axel Pierru Pierru, Axel
Shreekar Pradhan Pradhan, Shreekar
February 3, 2020
Estimating the Household Consumption Function in Saudi Arabia: An Error Correction Approach

Estimating the Household Consumption Function in Saudi Arabia: An Error Correction Approach

Taylor & Francis Online

We estimate a micro-founded life-cycle consumption model for Saudi Arabia over the period 1970–2017 using error correction model procedures. Dynamic adjustments are significant, and both income and wealth are found to have significant effects, with a long-run marginal propensity to…

Goblan Al Gahtani, Carlo Andrea Bollino, Simona Bigerna, Axel Pierru

2019
KAPSARC’s Contribution to Evaluating the Impact of Price Controls
Regional Energy Markets Models, Data and Tools

KAPSARC’s Contribution to Evaluating the Impact of Price Controls

Axel Pierru, Walid Matar

The European Journal of Operational Research has just published a paper, “Measuring the effects of price controls using mixed complementarity models” (2019). It detailed a series of innovative modeling approaches developed by KAPSARC researchers over the last six years. The…

Axel Pierru Pierru, Axel
Walid Matar Matar, Walid
September 1, 2019
Estimating the Household Consumption Function in Saudi Arabia
Evaluation of Public Investment Projects Energy and Economic Vulnerability

Estimating the Household Consumption Function in Saudi Arabia

Goblan Al Gahtani, Carlo Andrea Bollino, Simona Bigerna, Axel Pierru

This research is part of a joint project between the Saudi Arabian Monetary Authority (SAMA) and the King Abdullah Petroleum Studies and Research Center (KAPSARC). This paper estimates a micro-based life cycle consumption model for Saudi Arabia over the period…

Goblan Al Gahtani Goblan Al Gahtani
Carlo Andrea Bollino Bollino, Carlo Andrea
Simona Bigerna Bigerna, Simona
Axel Pierru Pierru, Axel
February 5, 2019
The Economic Impact of Price Controls on China’s Natural Gas Supply Chain

The Economic Impact of Price Controls on China’s Natural Gas Supply Chain

Science Direct

Despite significant progress made by China in liberalizing its natural gas market, certain key areas such as market access and pricing mechanisms remain controlled by the government.

Axel Pierru, Kang Wu, Frederic Murphy, Philipp Galkin, Bertrand Rioux, Yan Li, Artem Malov, Felipe Feijoo

2019
The Costs and Gains of Coordinating Electricity Generation in the Gulf Cooperation Council Utilizing the Interconnector
Regional Energy Markets

The Costs and Gains of Coordinating Electricity Generation in the Gulf Cooperation Council Utilizing the Interconnector

David Wogan, Frederic Murphy, Axel Pierru

Countries in the Gulf Cooperation Council (GCC) have installed a network of high-voltage transmission lines, known as the GCC Interconnector, which links the member states of Saudi Arabia, Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates (UAE). The Interconnector…

David Wogan Wogan, David
Frederic Murphy Murphy, Frederic
Axel Pierru Pierru, Axel
June 10, 2018
OPEC’s Impact on Oil Price Volatility: The Role of Spare Capacity
Future of Global Oil Markets

OPEC’s Impact on Oil Price Volatility: The Role of Spare Capacity

Energy Journal

OPEC claims to hold and use spare production capacity to stabilize the crude oil market. We study the impact of that buffer on the volatility of oil prices. After estimating the stochastic process that generates shocks to demand and supply,…

Axel Pierru, Tamim Zamrik

2018
The Economic Impact of Price Controls on China’s Natural Gas Supply Chain
Regional Energy Markets

The Economic Impact of Price Controls on China’s Natural Gas Supply Chain

Bertrand Rioux, Philipp Galkin, Frederic Murphy, Axel Pierru, Kang Wu

Despite significant progress made by China in liberalizing its natural gas market, certain key areas such as market access and pricing mechanisms remain heavily monopolized or controlled by the government. To assess how such distortions impact the market, we developed…

Bertrand Rioux Rioux, Bertrand
Philipp Galkin Galkin, Philipp
Frederic Murphy Murphy, Frederic
Axel Pierru Pierru, Axel
Kang Wu Wu, Kang
May 24, 2018
The Value of Saving Oil in Saudi Arabia
Evaluation of Public Investment Projects

The Value of Saving Oil in Saudi Arabia

Jorge Blazquez, Baltasar Manzano, Axel Pierru

What is the value of saving a barrel of oil that would otherwise had been consumed domestically? This study explores the question, taking a long-run perspective into a general equilibrium approach. In the case of Saudi Arabia, the difference between…

Jorge Blazquez Blazquez, Jorge
Baltasar Manzano Manzano, Baltasar
Axel Pierru Pierru, Axel
March 25, 2018
Restructuring Saudi Arabia’s Power Generation Sector: Model-Based Insights
Electricity Sector Transitions

Restructuring Saudi Arabia’s Power Generation Sector: Model-Based Insights

Bertrand Rioux, Axel Pierru, Nader AlKathiri

Saudi Arabia plans to reform and privatize its power generation sector as part of the Kingdom’s Vision 2030. To provide analytical insights, we developed a model that simulates the restructuring of the electricity market, along with reforming fuel prices to…

Bertrand Rioux Rioux, Bertrand
Axel Pierru Pierru, Axel
Nader AlKathiri AlKathiri, Nader
December 20, 2017
Managing Oil Revenue Stabilization Funds: A Framework for Developing Policies
Evaluation of Public Investment Projects Energy and Economic Vulnerability

Managing Oil Revenue Stabilization Funds: A Framework for Developing Policies

Nader AlKathiri, Frederic Murphy, Axel Pierru

Oil revenue stabilization funds provide short-run protection against oil revenue fluctuations – in the way that Saudi government deposits and reserve at the Saudi Arabian Monetary Authority (SAMA) have historically served as a buffer to decouple government budget from oil…

Nader AlKathiri AlKathiri, Nader
Frederic Murphy Murphy, Frederic
Axel Pierru Pierru, Axel
October 4, 2017
Efficient industrial energy use: The first step in transitioning Saudi Arabia’s energy mix

Efficient industrial energy use: The first step in transitioning Saudi Arabia’s energy mix

Energy Policy

In Saudi Arabia, industrial fuel prices are administered below international prices and firms make decisions based on low energy prices, increasing domestic energy demand. This analysis explores alternative policies designed to induce a transition to a more efficient energy system…

Walid Matar, Frederic Murphy, Axel Pierru, Bertrand Rioux, David Wogan

2017
A tutorial on building policy models as mixed-complementarity problems

A tutorial on building policy models as mixed-complementarity problems

Interfaces

After 50 years of development, building and solving mixed-complementarity problems (MCPs) have become commonplace for policy models that analyze markets. These models are used to develop policies that reshape markets, or introduce markets that replace other organizational forms. In this…

Frederic Murphy, Axel Pierru, Yves Smeers

2016