The Effect of Economic Vulnerability on the Development of MENA Countries

The economic vulnerability of some countries stems from the fact that their economies are largely influenced by forces outside their control. Areas that are most affected by economic shocks should promote the position of a resilient economy in their policies.
This paper tries to examine the impact of economic vulnerability on the development index of MENA countries in the 1995-2015 period using the econometric method and panel data approach.
The results of the study indicate a negative and significant relationship between economic vulnerability and development index in the target countries. The innovation of this study is to calculate the impact of economic vulnerability in different countries. Iran is ranked sixth in terms of the fragility of the economy against economic shocks. Countries that are ranked worse are often those countries that either face political instability (domestic wars) or have a strong dependence on oil revenues. In this way, policies such as reducing dependence on oil revenues and paying attention to political stability are introduced as tools for controlling and strengthening the economy against external economic shocks.