Towards Integrated Multi-Objective Planning for National Development in Saudi Arabia
Creators: name: Al-Tamimi, Faisal M
Publisher: name: Carnegie Mellon University
Year: 2023
Subjects: subject: 140202 Economic Development and Growth
subject: FOS: Economics and business
subject: 140212 Macroeconomics (incl. Monetary and Fiscal Theory)
subject: 140303 Economic Models and Forecasting

description: Throughout this effort, our guiding principle has been that the study of development is better served by explicitly including the multi-dimensional and the multi-objective properties of development plans into policy relevant models. In order to be of operational use in policy analysis and guidance, the models should closely fit the substantive context and. where required, include relevant subsystems and their interdependencies. The extent of the required flexibilities for a multi-objective planning for national development, which our models readly accommodates, are generally dependent on proper integration of system characteristics (and exhibited behaviors) with decision making (which includes consideration of policy makers attitudes and the extent of their ability to exercise influence over the system’s behavior). In this thesis we represent mixed planning situations, observed in a large class of developing countries, by integrating models and information about system behaviors with planning activities affecting the inputs, the outputs and. in some cases, aspects of that behavior. Additionally, our framework and its analytical foundation accommodate the potential flexibilities required in modelling issues applicable to many development situations, particularly the simultaneous consideration of multiple objectives and their mixed impacts. The models presented in this thesis utilize the principles of input-output modelling to represent relationships between and within economic and social-demographic systems for both internal activities and dynamic flows over time. However, straightforward application of input-output models is not enough. Since planning is a goal-setting and decision-making activity, we need to modify input-output models to permit the satisfaction (as closely as possible) of these goals which involves compromise and adjustments of goals and preferences during the planning process. To do this we join input output analysis with the ideas of goal programming as a more faithful representation of the characteristics of development planning and decision making. Hence, we are able to structure an integrated system for national development with multiple and possibly conflicting goals. By integrating among input-output and goal programming principles, in thesis, we specifically introduce the elements of a policy making system adequate to deal with the many dimensions that need to be simultaneously considered when planning the development of a nation such as Saudi Arabia. Such a nation has many features not encountered in the usual planning-development literature. Generally speaking it has the status, characteristics and constraints particular to a "developing country." but it also has financial resources which are. theoretically, adequate for rapid development. These resources come largely, however, in the form of foreign exchange. Although Saudi Arabia may continue for some time to enjoy large foreign exchange surpluses, it must nevertheless consider shortages in human resources— in the domestic labor force— and in certain industrial outputs. An implicit objective of this proposed thesis is to provide a means for directing and controlling the balance between domestic and expatriate labor in a way that ensures that longer run capabilities within Saudi Arabia will be produced. Since policy directions and development programs are implemented on a variety of socio-economic as well as physical dimensions, another objective of this thesis is to clarify the interdependence among several of these subsystems and the cross impacts of their planning activities. The criteria to be used are not solely economic. Social and demographic characteristics must be simultaneously considered for long-run as well as short-run consequences in any reasonably adequate approach to development planning for Saudi Arabia. This, in turn, requires the development of adequate planning tools. This thesis addresses two subsystems namely Economic-Manpower and Housing development models. These subsystems in turn will form part of a multi-objective framework within which different aims and policies may be reconciled. Specifically, planning in Saudi Arabia is regarded as a process in which objectives and criteria. evolve rather than as a situation in which they have already been established. Impact analyses and implementability are part of the criteria of evaluation. Decisions emerge after a number of opinions, conflicts, and dissents are resolved, more or less, with a combining and recombining of information. Information feedback about the achievement of goals and their possible effects on others plays an important role, in our context, for the successive adjustments of preferences and reconciliation of conflicting goals between different decision-makers. In our context, the Ministry of Planning is seen to be the primary user of our models. Their interest is in the analysis of alternative solutions and the consequences of various subsystem requirements along with the trade-offs among planning activities. The Ministry of Planning’s role extends from coordination (among subsystem and government agencies' planning activities) to arbitration (reflecting policy directions from a higher authority-the Council of Ministers) among the alternative preferences and planning goals. As such, several preferences within and between subsystems (initially defined by planners in the various areas) could be indicated and thereafter adjusted in an iterative process. We have therefore, shown in various prototypes how the resulting effects of selected changes in goals and preferences including trade-offs among several of the goals can be traced and evaluated. All of the work in this thesis is anchored in the substantive context of Saudi Arabia. Data were collected from several sources and. because of the usual lacunae, used as prototypic (rather than actual) representation of Saudi Arabia's development characteristics. We had several objectives for our use of these prototype data: 1) to illustrate our model’s capabilities’. 2) to point to areas for data collection, and 3) in some cases, to examine tools and methods that could be used to provide necessary estimates. We may recall that one set of purposes of the models we selected is directed towards their use when the requisite data are available. An equally important set of uses, however, involves the use of these models to systematize the collection of data. The latter can help guide the needs for data quality in terms of the uses to which they are to be put. To portray all relevant aspects of the development situation characteristic of Saudi Arabia is a task beyond the scope of this thesis: therfore. we were rather selective. In Chapter One a review of the properties of multidimensional accounting and planning is presented in a way that is pertinent to this thesis. An outline of the planning and decision making structure in Saudi Arabia is also provided. This chapter concludes with a summary of models for socio-econom ic and housing development to be presented in detail in the following chapters of the thesis. In Chapter Two, we present the detailed development of a socio-economic model incorporate issues specific to the development of Saudi Arabia such as the changes in the structure of production with industrialization and the role of imports in supplementing domestic production. In addition, specific attention is accorded to the demographic and social aspects of labor inputs and outputs, particularly expatriate labor's participation in production and in government. Moreover, we introduce government agencies' plans for capital development and for their own operation. The planning problem is presented in Chapter Two as a multi objective goal program dealing simultaneously with expatriate labor and government planning goals. Finally, we examine multi period numerical applications of alternative policies to evaluate between alternative priorities and conflicting goals. In Chapter Three we develop a model for housing development indicating the various planning activities and behavioral changes influencing fam ily-to-house distributions. Housing development in this model is guided mainly by the criterion (of which the aim is to improve conditions) for families whose housing is considered to be within the government's direct or indirect responsibility. We also consider the inputs and outputs of families as well as their changing characteristics over time. This includes the migration and immigration of expatriate families and the ensuing housing requirements and/or vacancies. We then link this model to the overall socio-economic model developed in Chapter Two to examine the cross impacts as well as the multiplier effects of housing development on the rest of the system. The planning problem is presented in Chapter Three as a multi objective goal program dealing simultaneously with goals related to the housing distribution of new families and the redistribution of existing families. Further, by linking this model to the socio-economic model developed in Chapter Two. we consider also those goals dealing with expatriate labor and with government plans. Finally, we examine numerical applications of alternative policies to evaluate alternative priorities and goals...