The Impact of Fiscal Policy on Oil Prices - The Case of Algeria During the Period From 1970 to 2022

Abstract

There is a consensus among experts in the field of economics that the wea economic performance of certain oil-exporting countries can be attributed to their approach in responding to fluctuations in petroleum prices. This is primarily due to the fact that in most of these countries, government expenditures are heavily reliant on revenues generated from the export of hydrocarbons. This research paper aims to examine the impact of petroleum price fluctuations on several macroeconomic indicators in Algeria from 1970 to 2022. These variables include the gross domestic product, petroleum price, currency rate, imports, and total income. The price of petroleum is regarded as the primary determinant of economic activity in Algeria. This may be demonstrated by the function of Batch responsiveness, which measures the responsiveness of variables to changes in petroleum prices.