Economic Diversification in Bahrain

Rami Mohammad Abu Wadi, Ala' G. Bashayreh


The study aims at analyzing the effect of economic diversification on economic growth in Bahrain for the period (1980-2014). For this purpose, many indicators were developed using The Herfindahl-Hirschman index (HHI) and five variables: real GDP, exports, imports, government revenues and fixed capital formation. Results reveal a weak diversification in the Bahraini’s economy besides a positive effect of diversification on the economic growth in Bahrain. In fact, no significant relationship between Herfindahl index and the growth of real GDP.

Keywords: Economic Diversification, Economic Growth, Herfindahl-Hirschman index.

JEL Classifications: L25, O47

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