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One hundred years of Dutch disease in Macondo: the rise and collapse of coffee and oil booms in Colombia

Author

Listed:
  • Diana Stella Antonio Rojas

    (Universitat de Girona, Girona, Spain)

  • Gonzalo Cómbita Mora

    (Universidad de la Salle, Facultad de Economía, Empresa y Desarrollo Sostenible, Bogotá, Colombia)

Abstract

This paper aims to advance the empirical understanding of Dutch disease in Colombia by integrating theory, history, and econometrics. It first reviews the main analytical traditions and argues that the canonical Corden-Neary model cannot fully account for Colombia’s long run trajectory, motivating the adoption of a broader heterodox perspective. The empirical contribution is twofold. First, a descriptive historical analysis traces the evolution of coffee and oil booms and their relationship with structural change over the twentieth century. Second, a difference VAR is estimated to examine the short run statistical linkages among the real exchange rate, the industrial share of GDP, and the export shares of coffee and oil. The results indicate that, coffee shocks generate stronger industrial gains than oil; real depreciation temporarily supports manufacturing; industrialization shows strong path dependence; and commodity booms repeatedly induce real appreciation consistent with Colombia’s long run pattern of cyclical overvaluation. JEL Classification: O11; O14; F41; F44; N16.

Suggested Citation

  • Diana Stella Antonio Rojas & Gonzalo Cómbita Mora, 2026. "One hundred years of Dutch disease in Macondo: the rise and collapse of coffee and oil booms in Colombia," Brazilian Journal of Political Economy, FGV EAESP, vol. 46(2), pages 263807-2638, May.
    • Handle: RePEc:ekm:repojs:v:46:y:2026:i:2:id:98256
    DOI: 10.1590/3086-44612026-3807
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    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles
    • N16 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Latin America; Caribbean

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