Title: Bi-Demographic Changes and Current Account using SVAR Modeling,
Abstract: The paper, as a new contribution, aims to explore the impacts of
bi-demographic structure on the current account and growth. By using a SVAR
modeling, we track the dynamic impacts between the underlying variables of the
Saudi economy. New insights have been developed to study the interrelations
between population growth, current account and economic growth inside the
neoclassical theory of population. The long-run net impact on economic growth
of the bi-population growth is negative, due to the typically lower skill sets
of the immigrant labor population. Besides, the negative long-run contribution
of immigrant workers to the current account growth largely exceeds that of
contributions from the native population, because of the increasing levels of
remittance outflows from the country. We find that a positive shock in
immigration leads to a negative impact on native active age ratio. Thus, the
immigrants appear to be more substitutes than complements for native workers.