ABSTRACT
A frequent lament heard in the United States notes: “We are spending all of our money buying petroleum from the Arab states, and we aren’t getting anything back.” It is my contention that while there certainly is a transfer of financial resources from the industrialized West to the Arab petroleum-exporting states, it is far less dramatic than it might appear initially. Measuring the extent of financial redistribution is, of course, extremely complicated. We can gain some insights by examining the trade patterns between the Middle Eastern OPEC states and the rest of the world. In particular, this paper considers the changing balance of trade situation of various Middle Eastern states vis-a-vis the Western industrialized states; it investigates what happens to economic resources when they are temporarily shifted from the West to the Middle East through the purchase of oil. Markov chain analysis is used to estimate the equilibrium distribution resources in the global system.
