DP8694 Natural resource wealth: the challenge of managing a windfall

Author(s): Frederick van der Ploeg, Anthony Venables
Publication Date: December 2011
Keyword(s): absorptive capacity, Dutch disease, fiscal rules, managing windfalls, public investment, resource curse, volatility
JEL(s): E60, F34, F35, F43, H21, H63, O11, Q33
Programme Areas: International Macroeconomics, Development Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=8694

Many countries have failed to use natural resource wealth to promote growth and development. They have been damaged by volatility of revenues, have failed to save a sufficiently high proportion of their resource revenues and failed to make high return investments to support diversification of their economies. This paper explores the reasons for these failures and discusses policies to improve performance.