The Russian Oil Fund as a Tool of Stabilization and Sterilization
AbstractThe favorable world oil price dynamics has resulted in mounting reserves in the Russian Oil Stabilization Fund (OSF). This has raised the issue of an adequate economic policy response. Initially, the OSF was set up to reduce the vulnerability of the budget to the oil price volatility and to sterilize the impact of oil-related foreign exchange infl ows on the money supply. Our fi ndings suggest that the OSF has been instrumental in achieving both goals: it has contributed to macroeconomic stability and has helped decouple the GDP growth rate from oil price dynamics. However, given the current size of the OSF and a widely shared expectation that oil prices will remain comparatively high, the present dilemma is whether the OSF should be increasingly spent or whether it should be saved as a wealth-generating vehicle. Spending from the OSF on a current basis has been resisted so far largely because of rampant corruption and fears of infl ation. However, there are several arguments which may support a change in this policy stance. In particular, it seems that concerns about intergenerational solidarity are of minor relevance for Russia; investments in the country’s infrastructure are badly needed which, via productivity gains, might counteract the possible Dutch disease effects; moreover, spending on public sector wages could reduce incentives for corruption.
Download InfoIf 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.
Bibliographic InfoArticle provided by Oesterreichische Nationalbank (Austrian Central Bank) in its journal Focus on European Economic Integration.
Volume (Year): (2007)
Issue (Month): 1 ()
Postal: Oesterreichische Nationalbank, Documentation Management and Communications Services, Otto-Wagner Platz 3, A-1090 Vienna, Austria
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Jerger, JÃ¼rgen & Migrow, Dimitri, 2009.
"Stabilisierungsfonds und makroÃ¶konomische Governance,"
University of Regensburg Working Papers in Business, Economics and Management Information Systems
433, University of Regensburg, Department of Economics.
- JÃ¼rgen Jerger & Dimitri Migrow, 2009. "Stabilisierungsfonds und makroÃ¶konomische Governance," Working Papers, Institut fÃ¼r Ost- und SÃ¼dosteuropaforschung (Institute for East and South-East European Studies) 274, Institut fÃ¼r Ost- und SÃ¼dosteuropaforschung (Institute for East and South-East European Studies).
- Peter Havlik & Wlodzimierz Kalicki & L. Randall Wray, 2008. "Monthly Report No. 5/2008," wiiw Monthly Reports 2008-05, The Vienna Institute for International Economic Studies, wiiw.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Birgit Riedler).
If references are entirely missing, you can add them using this form.