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Dealing with Negative Oil Shocks: The Venezuelan Experience in the Eighties

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  • Ricardo Hausmann

Abstract

The Venezuelan experience in the 1980s is a particularly fertile ground for the analysis of negative shocks. Two large shocks took place under very different control regimes, thus highlighting the role the institutional setting plays in determining the response. Moreover, the experience can shed a different light into the convenience of alternative exchange rate regimes for countries subject to large and frequent trade shocks. In addition, the analysis can be simplified for two reasons. First, oil shocks only have direct effects on the public sector, thus implying that it is the policy reaction to the shock that will affect households and firms. Secondly, the supply response of the oil industry is not of macroeconomic interest.

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  • Ricardo Hausmann, 1995. "Dealing with Negative Oil Shocks: The Venezuelan Experience in the Eighties," Research Department Publications 4010, Inter-American Development Bank, Research Department.
    • Handle: RePEc:idb:wpaper:4010
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    Cited by:

    1. Everhart, Stephen & Duval-Hernandez, Robert, 2001. "Management of oil windfalls in Mexico : historical experience and policy options for the future," Policy Research Working Paper Series 2592, The World Bank.
    2. Mohammad Ali MORADI, 2009. "Oil Resource Abundance, Economic Growth,and Income Distribution in Iran," EcoMod2009 21500069, EcoMod.
    3. Mr. James Daniel, 2001. "Hedging Government Oil Price Risk," IMF Working Papers 2001/185, International Monetary Fund.

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