Question

5) Based on information from a variety of sources, out of all countries –

Saudi Arabia ranks 26th in healthcare while the United States ranks 31st

Saudi Arabia ranks 95th in the lack of civil unrest while the United States ranks 97th

Saudi Arabia ranks behind the United States in terms of education

Saudi Arabia has investment of 30.75% of GDP while the United States is 19.754%

All of this suggests that the standards of living in the United States and Saudi Arabia are very similar - using this, answer the question below.

Suppose a country with a low standard of living asks for your advice on whether it should try to emulate Saudi Arabia or the United States in pursuing its goal of increasing its standard of living. What would you advise?

Answer 1

We would advice usa model. Except oil Saudi hardly produces anything. For other things it depends on others whereas usa is self sufficient in technology, knowledge etc. Human capital is highly developed in usa. In Saudi for royals education and research hardly mattered. Saudi will face crisis with exhaustion of oil and gas whileas usa will innovate always. Neither is there democracy, free choice, freedom etc in Saudi. The institutions for promoting growth are hardly there.