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Resource Revenues and Fiscal Sustainability in Alberta

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Author Info

  • Leslie Shiell

    ()
    (Department of Economics, University of Ottawa)

  • Colin Busby

    ()
    (C.D. Howe Institute)

Abstract

Alberta’s public finances depend upon volatile revenues from an exhaustible resource base. The question arises of what proportion of current resource revenues the government should spend on current priorities and what proportion it should save for future generations. The paper uses the Permanent Resource Income Model to answer the following four questions: Has Alberta saved enough of its resource revenues to date? What level of spending out of resource wealth is sustainable moving forward? What are the implications of a sustainable policy for the province’s current budget planning? Should Alberta follow Norway’s example of saving all of its resource revenues in a fund and spending only the resulting investment income?

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Bibliographic Info

Paper provided by University of Ottawa, Department of Economics in its series Working Papers with number 0807E.

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Length: 49 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:ott:wpaper:0807e

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Keywords: Natural resource revenues; Fiscal sustainability;

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