Advanced Search
MyIDEAS: Login to save this article or follow this journal

The Dutch Disease in Kazakhstan: An Empirical Investigation

Contents:

Author Info

  • Balázs Égert

    ()
    (Oesterreichische Nationalbank)

  • Carol S. Leonard

    ()

Abstract

In this paper we investigate whether or not the Dutch disease is at work in, or poses a threat to, the Kazakh economy. For this purpose, we fi rst summarize the mechanism through which fl uctuations in the price of oil could possibly damage the non-oil manufacturing industry and thus the long-term growth perspectives of an economy that relies heavily on oil production. Subsequently, we seek to analyze the specifi c chains of this transmission mechanism in Kazakhstan. The analysis of annual data for the period from 1998 to 2005 suggests that non-oil manufacturing has so far been spared the perverse effects of oil price increases. However, the real exchange rate of the open sector has appreciated during the last couple of years chiefl y due to the appreciation of the nominal exchange rate. In a second step, we analyze to what extent this appreciation is linked to oil price developments and oil revenues. Our econometric estimations based on the monetary model of the exchange rate and a variety of real exchange rate models provide us with some indication that the rise in the price of oil and in oil revenues might be linked to an appreciation of the U.S. dollar exchange rate of the oil and non-oil sectors. However, the appreciation is mainly limited to the oil sector for the real effective exchange rate and seems to be statistically insignificant for the non-oil manufacturing sector.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.oenb.at/dms/oenb/Publikationen/Volkswirtschaft/Focus-on-European-Economic-Integration/2006/Focus-on-European-Economic-Integration-Q2-06/chapters/feei_2006_2_egert_leonard_tcm16-49883.pdf
Download Restriction: no

Bibliographic Info

Article provided by Oesterreichische Nationalbank (Austrian Central Bank) in its journal Focus on European Economic Integration.

Volume (Year): (2006)
Issue (Month): 2 ()
Pages: 85-108

as in new window
Handle: RePEc:onb:oenbfi:y:2006:i:2:b:3

Contact details of provider:
Postal: P.O. Box 61, A-1011 Vienna, Austria
Phone: +43/1/404 20 7405
Fax: +43/1/404 20 7499
Email:
Web page: http://www.oenb.at
More information through EDIRC

Order Information:
Postal: Oesterreichische Nationalbank, Documentation Management and Communications Services, Otto-Wagner Platz 3, A-1090 Vienna, Austria
Email:

Related research

Keywords:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Balázs �gert & László Halpern & Ronald MacDonald, 2006. "Equilibrium Exchange Rates in Transition Economies: Taking Stock of the Issues ," Journal of Economic Surveys, Wiley Blackwell, vol. 20(2), pages 257-324, 04.
  2. Tobias Kronenberg, 2002. "The Curse Of Natural Resources In The Transition Economies," Working Papers 241, Institut für Ost- und Südosteuropaforschung (Institute for East and South-East European Studies).
  3. Meese, Richard A. & Rogoff, Kenneth, 1983. "Empirical exchange rate models of the seventies : Do they fit out of sample?," Journal of International Economics, Elsevier, vol. 14(1-2), pages 3-24, February.
  4. Papyrakis, E. & Gerlagh, R., 2004. "The resource curse hypothesis and its transmission channels," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3764006, Tilburg University.
  5. Stock, James H & Watson, Mark W, 1993. "A Simple Estimator of Cointegrating Vectors in Higher Order Integrated Systems," Econometrica, Econometric Society, vol. 61(4), pages 783-820, July.
  6. Jan J.J. Groen, 1998. "The Monetary Exchange Rate Model as a Long-Run Phenomenon," Tinbergen Institute Discussion Papers 98-082/2, Tinbergen Institute.
  7. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-80, November.
  8. Egert, Balazs & Drine, Imed & Lommatzsch, Kirsten & Rault, Christophe, 2003. "The Balassa-Samuelson effect in Central and Eastern Europe: myth or reality?," Journal of Comparative Economics, Elsevier, vol. 31(3), pages 552-572, September.
  9. Balázs Égert & László Halpern & Ronald MacDonald, 2005. "Equilibrium Exchange Rates in T ransition Economies: T aking Stock of the Issues," Working Papers 106, Oesterreichische Nationalbank (Austrian Central Bank).
  10. Thorvaldur Gylfason, 2001. "Natural Resources and Economic Growth: What Is the Connection?," CESifo Working Paper Series 530, CESifo Group Munich.
  11. Kornélia Krajnyák & Jeromin Zettelmeyer, 1998. "Competitiveness in Transition Economies: What Scope for Real Appreciation?," IMF Staff Papers, Palgrave Macmillan, vol. 45(2), pages 309-362, June.
  12. Clements, Kenneth W. & Frenkel, Jacob A., 1980. "Exchange rates, money, and relative prices: The dollar-pound in the 1920s," Journal of International Economics, Elsevier, vol. 10(2), pages 249-262, May.
  13. MacDonald, Ronald, 1998. "What determines real exchange rates?: The long and the short of it," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 8(2), pages 117-153, June.
  14. Hamid Faruqee, 1995. "Long-Run Determinants of the Real Exchange Rate: A Stock-Flow Perspective," IMF Staff Papers, Palgrave Macmillan, vol. 42(1), pages 80-107, March.
  15. Maeso-Fernandez, Francisco & Osbat, Chiara & Schnatz, Bernd, 2005. "Pitfalls in estimating equilibrium exchange rates for transition economies," Economic Systems, Elsevier, vol. 29(2), pages 130-143, June.
  16. Bergstrand, Jeffrey H, 1991. "Structural Determinants of Real Exchange Rates and National Price Levels: Some Empirical Evidence," American Economic Review, American Economic Association, vol. 81(1), pages 325-34, March.
  17. Sachs, J-D & Warner, A-M, 1995. "Natural Resource Abundance and Economic Growth," Papers 517a, Harvard - Institute for International Development.
  18. Luca Antonio Ricci & Ronald MacDonald, 2002. "Purchasing Power Parity and New Trade Theory," IMF Working Papers 02/32, International Monetary Fund.
  19. Markus Knell & Helmut Stix, 2003. "How Robustare Money Demand Estimations? A Meta-Analytic Approach," Working Papers 81, Oesterreichische Nationalbank (Austrian Central Bank).
  20. Lionel Halpern & Charles Wyplosz, 1996. "Equilibrium Exchange Rates in Transition Economies," IMF Working Papers 96/125, International Monetary Fund.
  21. Kuralbayeva, Karlygash & Kutan, Ali M. & Wyzan, Michael L., 2001. "Is Kazakhstan vulnerable to the Dutch disease?," ZEI Working Papers B 29-2001, ZEI - Center for European Integration Studies, University of Bonn.
  22. Enrique Alberola & Susana Garcia-Cervero & Humberto López & Angel Ubide, 2005. "Quo vadis Euro?," International Finance 0507004, EconWPA.
  23. Susana Garcia Cervero & J. Humberto Lopez & Enrique Alberola Ila & Angel J. Ubide, 1999. "Global Equilibrium Exchange Rates," IMF Working Papers 99/175, International Monetary Fund.
  24. Antonio Spilimbergo, 1999. "Copper and the Chilean Economy, 1960-19+L159298," IMF Working Papers 99/57, International Monetary Fund.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Balázs Égert, 2009. "Dutch Disease in Former Soviet Union: Witch-Hunting," CASE Network Studies and Analyses 0380, CASE-Center for Social and Economic Research.
  2. Oskenbayev, Yessengali & Karimov, Aziz, 2013. "Is Kazakhstan vulnerable to natural resource curse?," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:onb:oenbfi:y:2006:i:2:b:3. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Birgit Riedler).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.