ABSTRACT
This chapter reveals that the quintessence of the Saudi polity is Islam, and demonstrates that the critical fact in the Saudi economy is petroleum. A casual visitor to Saudi Arabia would notice the atmosphere of mutual respect and cordiality which characterizes the relations between Americans and Saudi officials. The social organization of Saudi Arabia is relatively simple as contrasted to such complex societies as those of, for example, India, Lebanon or China. Its relative simplicity rests on the fact that it is sparsely populated and the population is concentrated in a few areas. The exogenous institutional sources of innovation in Saudi Arabia are somewhat different than they are in other developing countries. The far-sighted policy of the Saudi government for its students abroad with generous allowances for living and tuition with annual trips back to Saudi Arabia has resulted in a situation in which there is no brain drain at all.
