The Dutch disease revisited: consistency of theory and evidence
Abstract The Dutch disease literature reveals several gaps between empirical evidence and theoretical predictions. To bridge such gaps, I develop a model that accounts for uneven spillovers of technological progress from the resource sector to other domestic sectors. I then employ a dynamic panel approach to align the theory with the data. I find that the real exchange rate appreciation resulting from a resource boom (i.e., the spending channel) is more pronounced in resource-poor countries than in resource-rich countries. Additionally, the resource movement channel exhibits differences betwee... Mehr ...
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Dokumenttyp: | Artikel |
Erscheinungsdatum: | 2023 |
Reihe/Periodikum: | Environmental and Resource Economics ; ISSN 0924-6460 1573-1502 |
Verlag/Hrsg.: |
Springer Science and Business Media LLC
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Schlagwörter: | Management / Monitoring / Policy and Law / Economics and Econometrics |
Sprache: | Englisch |
Permalink: | https://search.fid-benelux.de/Record/base-27069586 |
Datenquelle: | BASE; Originalkatalog |
Powered By: | BASE |
Link(s) : | http://dx.doi.org/10.1007/s10640-023-00827-w |
Abstract The Dutch disease literature reveals several gaps between empirical evidence and theoretical predictions. To bridge such gaps, I develop a model that accounts for uneven spillovers of technological progress from the resource sector to other domestic sectors. I then employ a dynamic panel approach to align the theory with the data. I find that the real exchange rate appreciation resulting from a resource boom (i.e., the spending channel) is more pronounced in resource-poor countries than in resource-rich countries. Additionally, the resource movement channel exhibits differences between resource-rich and resource-poor countries. In resource-rich countries, a resource boom reduces the growth rate in the manufacturing sector more than in the service sector, leading to a decrease in relative sectoral output and a slowdown in economic growth. On the other hand, in resource-poor countries, a resource boom accelerates the growth of the manufacturing sector and decelerates the growth of the service sector, resulting in an increase in relative sectoral output and economic growth.