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Public Investment to Reverse Dutch Disease: The Case of Chad

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Stephanie Levy

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Abstract

This paper studies the relevance of agricultural policies for avoiding Dutch disease, which affects many less developed countries experiencing a resource boom. Using a computable general equilibrium model calibrated for Chad, we study the impact of using this country's annual oil revenue for public investment, particularly in the development of road and irrigation infrastructure. Our model takes into account the integration of markets and migration processes. We find that improving water access would reduce Chad's dependence on food aid and entail a substantial improvement in rural household welfare. Copyright 2007 The author 2007. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

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File URL: http://hdl.handle.net/10.1093/jae/ejl043
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Publisher Info
Article provided by Oxford University Press in its journal Journal of African Economies.

Volume (Year): 16 (2007)
Issue (Month): 3 (June)
Pages: 439-484
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Handle: RePEc:oup:jafrec:v:16:y:2007:i:3:p:439-484

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References listed on IDEAS
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  1. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March. [Downloadable!] (restricted)
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  2. Pinto, Brian, 1987. "Nigeria during and after the Oil Boom: A Policy Comparison with Indonesia," World Bank Economic Review, Oxford University Press, vol. 1(3), pages 419-45, May.
  3. Auty, Richard M., 1994. "Industrial policy reform in six large newly industrializing countries: The resource curse thesis," World Development, Elsevier, vol. 22(1), pages 11-26, January. [Downloadable!] (restricted)
  4. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-48, December. [Downloadable!] (restricted)
  5. Binswanger, Hans P. & Khandker, Shahidur R. & Rosenzweig, Mark R., 1993. "How infrastructure and financial institutions affect agricultural output and investment in India," Journal of Development Economics, Elsevier, vol. 41(2), pages 337-366, August. [Downloadable!] (restricted)
  6. Azam, Jean-Paul, 1999. "Dollars for Sale: Exchange Rate Policy and Inflation in Africa," World Development, Elsevier, vol. 27(10), pages 1843-1859, October. [Downloadable!] (restricted)
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This page was last updated on 2009-11-28.


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