Chapter 2. Economic Theory and Natural Resource Booms
Author: Mr. Niko A Hobdari, Ms. Chonira E Aturupane, Mr. Eric Le Borgne1, Mr. Koba Gvenetadze, Mr. John Wakeman-Linn, and Mr. Stephan Danninger
  • 1 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund
Language:
English
Keywords:
ISI; SI; natural resource boom; government; natural resource; deficit; windfall oil revenue; oil revenue management; oil wealth; oil deficit; Oil; gas and mining taxes; Natural resources; Oil prices; Sub-Saharan Africa; Africa; Asia and Pacific; traded-goods industry; natural resource curse; natural-resource-inspired boom; Dutch disease model; Real exchange rates; Dutch disease

Abstract

Studies of experiences of countries rich in exhaustible natural resources reveal that natural-resource-driven booms have often led to deterioration in macroeconomic performance and uneven development of industry. Sachs and Warner (1995) provide empirical evidence that economies with abundant natural resources have tended to grow less rapidly than economies with scarce natural resources. Large foreign exchange inflows due to the exploitation of natural resources often turn into a curse for the country, particularly if they are mismanaged. This adverse effect of natural resources has been called the “Paradox of Plenty” (Karl, 1999).

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Cover Managing Oil Wealth
Managing Oil Wealth
The Case of Azerbaijan
Author: Mr. Niko A Hobdari, Ms. Chonira E Aturupane, Mr. Eric Le Borgne, Mr. Koba Gvenetadze, Mr. John Wakeman-Linn, and Mr. Stephan Danninger
ISBN:
9781589063082
Publication Date:
21 Apr 2004
Publisher:
International Monetary Fund
DOI:
https://doi.org/10.5089/9781589063082.058
Pages:
50

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