Oil revenues and the ‘Dutch disease’ in a developing country: Cameroon

Benjamín, Nancy; Devarajan, Shantayanan; Weiner, Robert J.

doi:10.1111/j.1468-0076.1986.tb00107.x

Cited by 46 publications

(71 citation statements)

References 6 publications

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“…With this specification we ignore the resource movement effect of a resource boom and concentrate on the spending effect. This is supported by Benjamin et al (1989) in a study of Cameron, and also seems reasonable for South Africa since the mining production is partly dependent on foreign labor (Jones, 2002a). In addition,…”

Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 53%

“…Lower household income negatively affects the demand for industrial goods and services, and limits the increase in the nontradable price as well. This last effect dominates, and in contrast to the result by Benjamin et al (1989), better substitution possibilities between domestic and foreign goods give weaker real appreciation after the resource boom.…”

Section: Sensitivity Analysis: Elasticity Of Substitution Between Dommentioning

confidence: 84%

“…Using a static general equilibrium framework Benjamin et al (1989) show that higher elasticity of substitution between domestic and foreign goods gives stronger real appreciation and more deindustrialization. In our model better substitution possibilities have two opposite effects on the real exchange rate.…”

Section: Sensitivity Analysis: Elasticity Of Substitution Between Dommentioning

confidence: 96%

“…Most applied general equilibrium analyses in the Dutch disease literature are static, and do not capture real exchange rate dynamics or long-run structural effects of the boom (see for instance Benjamin et al, 1989, andVos, 1998). As illustrated theoretically by Torvik (2001), productivity effects following a resource boom generate real depreciation after the initial appreciation of the real exchange rate, with further implications for factor allocation between sectors.…”

Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 99%

“…As discussed by Benjamin et al (1989), imperfect substitution between domestic and foreign goods affects the Dutch disease dynamics since the tradable price is endogenously determined and not given from the world market. The real exchange rate (RER) is defined as the relative price between nontradables and tradables, and is given by:…”

Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 99%

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Resource boom, productivity growth and real exchange rate dynamics — A dynamic general equilibrium analysis of South Africa

Stokke¹

2008

Economic Modelling

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We study the impact of a natural resource boom on structural change and real exchange rate dynamics, taking into account the indirect effect via relative sectoral productivity changes.Our contribution relative to the Dutch disease literature is threefold. First, the productivity specification is extended from simple learning by doing to include trade barriers and technology gap dynamics, consistent with the modern understanding of productivity growth.Second, we offer a dynamic general equilibrium model with imperfect substitution between domestic and foreign goods. Third, the model is applied to South Africa and analyzes the macroeconomic impact of the gold price increase in the 1970s. Political pressure for rapid domestic spending after a surge in resource rents tends to generate myopic government behavior with unsustainable high consumption spending. Such fiscal response to higher resource income is captured by the model specification. Numerical simulations show how the resource boom can help explain the structural change and real exchange rate path observed in South Africa. Due to productivity effects the initial real appreciation is followed by gradual depreciation of the real exchange rate.JEL no: O33, O41, O55, Q33.

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Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 53%

Section: Sensitivity Analysis: Elasticity Of Substitution Between Dommentioning

confidence: 84%

Section: Sensitivity Analysis: Elasticity Of Substitution Between Dommentioning

confidence: 96%

Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 99%

Section: The Dynamic General Equilibrium Model With Endogenous Producmentioning

confidence: 99%

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Resource boom, productivity growth and real exchange rate dynamics — A dynamic general equilibrium analysis of South Africa

Stokke¹

2008

Economic Modelling

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Price distortion in the transition process: A CGE analysis of China's case

1993

Econ Plann

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The correct evaluation of price distortion is a prerequisite for designing the correct price reform policy which is of tremendous importance in the transitions process from a centrally planned economy to a market economy. The purpose of this paper is to investigate the advantages and shortcomings of various criteria for evaluating price distortion. Based on the characteristics of a two-tiered planned-market system in Chinese economic reform, a computable general equilibrium (CGE) model has been built to evaluate quantitatively the degree of price distortion in the prevailing price system and the effects of price adjustments in order to propose a reasonable price reform policy. The difference between the planned price and the equilibrium price seems to be a better indicator for evaluating the degree of price distortion than others. Furthermore, this difference provides more accurate feedback for price reform policies in order to ensure a stable and controllable price reform process.

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What happens when exports expand: some ideas for closure of regional computable general equilibrium models

Holland

2009

Ann Reg Sci

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While there is general agreement on various features of “standard” regional computable general equilibrium (RCGE) models, there has been little discussion of representative macro behavioral assumptions and model closure. The purpose of this paper is to review the main differences between regional and national CGE models regarding factor market, government and saving behavior and to suggest a standard closure for representative regional CGE models. Copyright Springer-Verlag 2010R13,

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Oil revenues and the ‘Dutch disease’ in a developing country: Cameroon

Cited by 46 publications

References 6 publications

Resource boom, productivity growth and real exchange rate dynamics — A dynamic general equilibrium analysis of South Africa

Resource boom, productivity growth and real exchange rate dynamics — A dynamic general equilibrium analysis of South Africa

Price distortion in the transition process: A CGE analysis of China's case

What happens when exports expand: some ideas for closure of regional computable general equilibrium models

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