Abstract
Purpose
The purpose of this paper is to empirically test the validity of the productivity bias hypothesis (PBH) in 18 Middle East countries.
Design/methodology/approach
The paper employs autoregressive-distributed lag approach to cointegration approach and stability tests.
Findings
The empirical results suggest the existence of the PBH only in the case of Bahrain, Kuwait and Saudi Arabia.
Practical implications
Conclusions drawn from this research could be useful for the policy-makers of governments and practitioners in international trade organizations.
Originality/value
This study extends the existing literature by providing initial empirical time series evidence of the PBH for the entire Middle East countries.
Subject
General Economics, Econometrics and Finance
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