The Institute of Risk Management says “Risk perception is a highly personal process of decision making,
based on an individual’s frame of reference developed over a lifetime, among many other factors.”
With regard to this, critically evaluate key socio-psychological factors that can influence people’s
perception of a risk that is appropriate to your programme of study.
Countless times over, we have seen incidents regarding the rise and fall of countries that base their economy, as well as domestic currency, on oil: Algeria, Venezuela, Nigeria, Iran, Indonesia, and many more. Most countries such as these, after resource booms, cannot stabilize their economy, and fall victim to Dutch Disease. The sheer appreciation of wages and domestic currency yields a field in which exports become uncompetitive and cause damage to other industries such as agriculture and manufacturing; this renders countries de-industrialized (Mohamed). Countries with exceptionally large oil exports can rarely escape this curse of plenty. They fail to make steps to reform their oil dependence, and instead, plunge headfirst into a sudden (yet predictable) violent political, economic, and social upheaval, as seen currently in Venezuela. However, one country within OPEC has managed to keep its head above the oil. Despite oil prices plummeting, poor national perception regarding Yemen, as well as the murder of Jamal Khashoggi, Saudi Arabia still makes and maintains massive profit margins as it only costs them $9 USD to produce a single barrel (WSJ News Graphics). This begs the question: What makes Saudi Arabia any different than these other countries, who have seemingly doused their economies, citizens, governments, and domestic currency in crude oil, lit a match, and set themselves ablaze? Why is it that now, in a time when oil prices are steadily dropping, Saudi Arabia can function with oil prices so low, and how does the volatility of oil affect Saudi Arabia’s environment domestically and geopolitically? Oil prices have been dropping in response to a large production output and a weaker global demand (International Energy Agency). However, this is not the sole reaso>GET ANSWER