Quantifying Dutch disease effects and asymmetry in economic responses to oil price volatility in Kuwait

The motivation for this study is to fill existing gaps in the understanding of the economic impacts of oil price volatility on Gulf Cooperation Council (GCC) economies and to assist in the management of recent oil price shocks following the COVID-19 pandemic. To that end, this paper employs an economy-wide general equilibrium model that embodies Kuwait’s economic structure and accounts for its political and economic constraints to quantify asymmetric responses of terms of trade shocks in Kuwait. It highlights impacts on non-energy sectors and ‘second-best effects’ to draw potentially-applicabl... Mehr ...