Bismi Allah Arrahman Arraheem

Dr. Usamah Ahmed Uthman

Associate Professor of Economics

Department of Finance & Economics

College of Industrial Management

King Fahd University of Petroleum & Minerals

Dhahran 31261

Saudi Arabia

E-mail: osama@kfupm.edu.sa

Topics for research, term papers, projects and, CO- Op Reports

The following topics can be discussed at any level of sophistication. They can be discussed at the undergraduate level, the graduate level, or as full-fledged academic papers. Also, some of these issues can be discussed from both micro-, and macroeconomic perspectives.

Islamic Economics & Finance:

1) Islamic Financing of Households Needs of Services: Services such as education, medication, and travel cannot be financed by asset- based contracts such as Murabaha and Ijarah. What Islamic methods can be developed to finance such needs? What are the risk implications of such methods?

2) Risk in Islamic Finance: What are the sources of risk in Islamic finance? How risky is Islamic finance relative to traditional finance? What are the Shari’a – compatible ways to reduce risk in Islamic finance?

3) Islamic Options? What are the options in Islamic finance? How compatible are traditional options with Shari’a? Can we design modern Shari’a - compatible options? How can they be priced?

4) Murabaha And Tawarug: Compare and contrast the Murabaha and Tawarug contracts from both the Shari’a( Islamic Law ), and economic perspectives.

5) The Modern Application of Zakat: Zakat( a major form of Islamic taxation) is collected in- kind when applied on livestock and storable agricultural products. How could a modern application of an in- kind tax be used to reduce poverty and improve efficiency?

Macroeconomics:

6) Measuring The Value Added: The value added by a firm represents its contribution to national income. Using the definition of Value added, measure the value added by a firm you may be working for, and find the breakdown of its payments to its factors of production. Do the same for other firms in the same business sector and for several years. This should indicate to you the relative importance of the firm to the entire sector, and the relative importance of the sector to the national economy. Also this should tell you something about the distribution of income between different owners of factors of production.

7) Foreign Labor Remittances: The World Bank has recently reported that remittances of foreign labor from Saudi Arabia (in 2003) have reached $15.9 billion, the second largest in the World. The highest being the USA with $ 31 billion. The total labor remittances for the whole World have been$93 billion. The Saudi figure represents in the Saudi current account and a huge leakage from the Saudi economy. What are the policy alternatives to deal with this problem?

8) Public Debt & Budget Deficit: Analyze the public debt and budget deficits of the Saudi Gov. into its prime component and the debt service component. Analyze the cyclical and structural parts of the deficit. What are the alternatives to close that deficit? What are the implications of each alternative?

9)Exchange Rate Policy & Pricing of Oil: The Saudi Riyal is pegged to the dollar. In light of the fluctuating value of the dollar against other currencies and the often – instability of oil prices, discuss the possible alternatives to help the Saudi Gov. to stabilize its oil income.

10) The Impossible Trio: It is said that it is impossible for any government to maintain together fixed exchange rate policy, independent monetary policy and free capital mobility. A government can choose only two of these policies. Discuss the case for Saudi Arabia. To what extent has monetary policy in S.A been passive? Why or why not?

11) Privatization: Discuss why, or why not the Saudi Government program of privatization may or may not be on the right track. What are the criteria for good privatization policy? What are the alternative methods for privatization? What sectors should be privatized first? What sectors should never be privatized?

Microeconomics:

12) Immigrating Labor Policy: The number of foreign labor in Saudi Arabia has exceeded six million people, or more than25% of the total population of the Country. How should the Government approach the problem of foreign labor? What are the consequences of preventing small firms (of less than ten workers) from getting visas to bring foreign labor? Has the Government’s policy of limiting certain jobs to Saudi workers been successful? Which sectors? How was it done? How much successful? How different is one sector from another? Discuss the short run and long run effects.

13) Labor Law: How should the Saudi labor law be amended to encourage the private sector to employ more Saudis? Should unemployment insurance be introduced as a safety net to make the labor law more flexible?

14) Elasticity of Labor Demand: Estimate the demand for foreign labor in the aftermath of the Saudi government’s decision to raise the fees for visas, Iqamas (residence permits), and work permits for foreign labor.

15) Elasticities: The prices of gasoline and electricity in Saudi Arabia have witnessed several hikes by the government. Estimate the price and income elasticities in each case. Also, estimate the income effect in each case.

16) Personal Income Tax: How desirable or undesirable would it be for the Government to impose a personal income tax on foreign labor? Who is to be taxed? At what rate? What should be the tax- exempt income? What would be the expected Gov. revenues from this tax? How would the tax affect the supply of foreign labor? How would this tax affect the private sector and how would it affect the public sector?

17)Corporate Income Tax: What are the pros and cons (in terms of efficiency and equity considerations) of imposing an income tax on Saudi firms in addition to the imposition of Zakat ?

18) Family- Owned Firms: Legal structure, financing, history, how large?, what kind of businesses? Market share in each line of business. External and internal threats. How to deal with such threats?

19) Fast Food Industry: Compare the Saudi- based fast food chains with the foreign –based ones in terms of products, market share, profitability, advertising, franchising conditions, type of customers…..etc.

20) Banking Industry: How competitive? What is the market share in each type of clientele? What type of assets, liabilities and relative weight of each. Factors affecting profitability (No. of branches, No. of employees, capital, ……etc). Market performance of own -share in the stock market.