Assessing the Efficiency of the Saudi Economy Through the Lens of the Global Knowledge Index (2021–2024)

Objectives This study aims to evaluate the efficiency of the Saudi economy using the Global Knowledge Index (GKI) during the period 2021–2024. It seeks to quantify the knowledge gap between Saudi Arabia and both advanced and low-performing economies, assess the Kingdom’s progress toward strengthening knowledge-driven economic performance, and identify the structural determinants influencing the economy index. The study contributes theoretically by applying the GKI as a multidimensional framework for assessing national economic efficiency, and empirically by generating evidence to support policy formulation and guide strategic reforms in Saudi Arabia’s transition toward a knowledge-based economy. Materials and Methods The study adopts a comparative descriptive–analytical approach supported by statistical hypothesis testing. It relies on official GKI data published by the United Nations Development Programme for the years 2021–2024. Analytical techniques include gap analysis to measure performance differentials between Saudi Arabia and benchmark economies, and regression-based statistical testing to identify the most influential determinants of the economy index. The analysis focuses on the relationship between the economy index and other GKI pillars, including the enabling environment, research, development and innovation, economic openness, economic competitiveness, and finance and local value-added. Results The findings indicate that the gap between Saudi Arabia and leading knowledge economies fluctuates over time, reflecting partial but inconsistent convergence toward global knowledge frontiers. In contrast, the gap between Saudi Arabia and low-performing economies remains large and relatively stable, confirming the Kingdom’s sustained superiority over that group. Statistical hypothesis testing reveals significant differences between the efficiency of the Saudi economy and the average efficiency of advanced economies, suggesting that full convergence has not yet been achieved. Regression analysis demonstrates that the economy index is strongly influenced by other GKI pillars. The enabling environment exerts the largest positive effect (coefficient = 1.50441), followed by the finance and local value-added pillar (0.771580), economic competitiveness (0.214418), and research, development, and innovation (0.18144). Conversely, the economic openness pillar shows the weakest effect (0.061784), indicating a structural constraint that limits investment attraction, export diversification, and knowledge transfer. These results highlight the importance of institutional quality, innovation capacity, and economic diversification in enhancing knowledge-based economic efficiency. Conclusion The study concludes that while Saudi Arabia demonstrates clear progress in strengthening its knowledge-driven economic performance, convergence with advanced knowledge economies remains incomplete. Expanding knowledge investments alone is insufficient to generate optimal economic returns without strong institutional quality, governance efficiency, and structural alignment mechanisms. The findings underscore the need to enhance research and innovation capacity, strengthen the enabling environment for entrepreneurship and investment, and expand economic openness—particularly through improving high-technology trade quality and facilitating foreign investment inflows. These reforms are essential for accelerating Saudi Arabia’s transition toward a competitive and sustainable knowledge-based economy.