IDEAS home Printed from https://ideas.repec.org/p/hal/wpaper/hal-01527664.html
   My bibliography  Save this paper

Is Chad affected by Dutch or Nigerian disease?

Author

Listed:
  • Sandrine Kablan

    (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)

  • Josef Loening

    (The World Bank - The World Bank - The World Bank)

Abstract

We examine the effects of the ‘natural resource curse' on Chad and find little evidence for Dutch disease. Structural vector auto-regression suggests that changes in domestic output and prices are overwhelmingly determined by aggregate demand and supply shocks, and while oil production and high international prices negatively affect agricultural output, the effects are small. Consistent with empirical evidence for neighbouring Cameroon, we observe minimal impact on Chad's manufacturing sector. We associate our findings with structural underemployment and the inefficient use of existing production factors. In this context, increased public expenditures in tradable sectors present the opportunity to make oil revenues an engine of national development.

Suggested Citation

  • Sandrine Kablan & Josef Loening, 2017. "Is Chad affected by Dutch or Nigerian disease?," Working Papers hal-01527664, HAL.
    • Handle: RePEc:hal:wpaper:hal-01527664
    Note: View the original document on HAL open archive server: https://hal.science/hal-01527664
    as

    Download full text from publisher

    File URL: https://hal.science/hal-01527664/document
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Blanchard, Olivier Jean & Quah, Danny, 1989. "The Dynamic Effects of Aggregate Demand and Supply Disturbances," American Economic Review, American Economic Association, vol. 79(4), pages 655-673, September.
    2. Costantini, Valeria & Monni, Salvatore, 2008. "Environment, human development and economic growth," Ecological Economics, Elsevier, vol. 64(4), pages 867-880, February.
    3. Benjamin, Nancy C. & Devarajan, Shantayanan & Weiner, Robert J., 1989. "The Dutch disease in a developing country : Oil reserves in Cameroon," Journal of Development Economics, Elsevier, vol. 30(1), pages 71-92, January.
    4. Neumayer, Eric, 2004. "Does the "Resource Curse" hold for Growth in Genuine Income as Well?," World Development, Elsevier, vol. 32(10), pages 1627-1640, October.
    5. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
    6. Budina, Nina & Pang, Gaobo & van Wijnbergen, Sweder, 2007. "Nigeria's growth record : Dutch disease or debt overhang ?," Policy Research Working Paper Series 4256, The World Bank.
    7. Rabah Arezki & Markus Brückner, 2012. "Resource Windfalls and Emerging Market Sovereign Bond Spreads: The Role of Political Institutions," The World Bank Economic Review, World Bank, vol. 26(1), pages 78-99.
    8. repec:hoo:wpaper:e-92-3 is not listed on IDEAS
    9. Xavier Sala-i-Martin & Arvind Subramanian, 2013. "Addressing the Natural Resource Curse: An Illustration from Nigeria," Journal of African Economies, Centre for the Study of African Economies, vol. 22(4), pages 570-615, August.
    10. Frankel, Jeffrey A., 2010. "The Natural Resource Curse: A Survey," Scholarly Articles 4454156, Harvard Kennedy School of Government.
    11. Matsuyama, Kiminori, 1992. "Agricultural productivity, comparative advantage, and economic growth," Journal of Economic Theory, Elsevier, vol. 58(2), pages 317-334, December.
    12. Fardmanesh, Mohsen, 1991. "Dutch disease economics and oil syndrome: An empirical study," World Development, Elsevier, vol. 19(6), pages 711-717, June.
    13. Hutchison, Michael M, 1994. "Manufacturing Sector Resiliency to Energy Booms: Empirical Evidence from Norway, the Netherlands, and the United Kingdom," Oxford Economic Papers, Oxford University Press, vol. 46(2), pages 311-329, April.
    14. Baland, Jean-Marie & Francois, Patrick, 2000. "Rent-seeking and resource booms," Journal of Development Economics, Elsevier, vol. 61(2), pages 527-542, April.
    15. Mr. Eugenio M Cerutti & Mr. Mario Mansilla, 2008. "Bolivia: The Hydrocarbons Boom and the Risk of Dutch Disease," IMF Working Papers 2008/154, International Monetary Fund.
    16. 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 825-848, December.
    17. Torvik, Ragnar, 2002. "Natural resources, rent seeking and welfare," Journal of Development Economics, Elsevier, vol. 67(2), pages 455-470, April.
    18. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-380, November.
    19. Lane, Philip R & Tornell, Aaron, 1996. "Power, Growth, and the Voracity Effect," Journal of Economic Growth, Springer, vol. 1(2), pages 213-241, June.
    20. Stephanie Levy, 2007. "Public Investment to Reverse Dutch Disease: The Case of Chad," Journal of African Economies, Centre for the Study of African Economies, vol. 16(3), pages 439-484, June.
    21. Brahmbhatt, Milan & Canuto, Otaviano & Vostroknutova, Ekaterina, 2010. "Dealing with Dutch Disease," World Bank - Economic Premise, The World Bank, issue 16, pages 1-7, June.
    22. repec:zbw:bofitp:2007_007 is not listed on IDEAS
    23. Brahmbhatt, Milan & Canuto, Otaviano, 2010. "Natural Resources and Development Strategy after the Crisis," World Bank - Economic Premise, The World Bank, issue 1, pages 1-7, February.
    24. Atkinson, Giles & Hamilton, Kirk, 2003. "Savings, Growth and the Resource Curse Hypothesis," World Development, Elsevier, vol. 31(11), pages 1793-1807, November.
    25. Ms. Mwanza Nkusu, 2004. "Aid and the Dutch Disease in Low-Income Countries: Informed Diagnoses for Prudent Prognoses," IMF Working Papers 2004/049, International Monetary Fund.
    26. International Monetary Fund, 2009. "Chad: Selected Issues," IMF Staff Country Reports 2009/067, International Monetary Fund.
    27. repec:bla:scotjp:v:45:y:1998:i:5:p:553-85 is not listed on IDEAS
    28. Philip R. Lane & Aaron Tornell, 1999. "The Voracity Effect," American Economic Review, American Economic Association, vol. 89(1), pages 22-46, March.
    29. Drelichman, Mauricio, 2005. "The curse of Moctezuma: American silver and the Dutch disease," Explorations in Economic History, Elsevier, vol. 42(3), pages 349-380, July.
    30. Ms. Katerina Kalcheva & Nienke Oomes, 2007. "Diagnosing Dutch Disease: Does Russia Have the Symptoms?," IMF Working Papers 2007/102, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:ipg:wpaper:2014-475 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:ipg:wpaper:2014-492 is not listed on IDEAS
    2. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    3. Mehrdad Vahabi, 2017. "A critical survey of the resource curse literature through the appropriability lens," CEPN Working Papers 2017-14, Centre d'Economie de l'Université de Paris Nord.
    4. repec:hal:cepnwp:hal-01583559 is not listed on IDEAS
    5. Alssadek, Marwan & Benhin, James, 2023. "Natural resource curse: A literature survey and comparative assessment of regional groupings of oil-rich countries," Resources Policy, Elsevier, vol. 84(C).
    6. Dauvin, Magali & Guerreiro, David, 2017. "The Paradox of Plenty: A Meta-Analysis," World Development, Elsevier, vol. 94(C), pages 212-231.
    7. Kaznacheev, Peter, 2013. "Resource Rents and Economic Growth: Economic and institutional development in countries with a high share of income from the sale of natural resources. Analysis and recommendations based on internatio," EconStor Research Reports 121950, ZBW - Leibniz Information Centre for Economics.
    8. Mehrdad Vahabi, 2018. "The resource curse literature as seen through the appropriability lens: a critical survey," Public Choice, Springer, vol. 175(3), pages 393-428, June.
    9. Grant Mark Nülle & Graham A. Davis, 2018. "Neither Dutch nor disease?—natural resource booms in theory and empirics," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 31(1), pages 35-59, May.
    10. Edouard Mien & Michaël Goujon, 2022. "40 Years of Dutch Disease Literature: Lessons for Developing Countries," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 64(3), pages 351-383, September.
    11. Matsen, Egil & Roisland, Oistein, 2005. "Interest rate decisions in an asymmetric monetary union," European Journal of Political Economy, Elsevier, vol. 21(2), pages 365-384, June.
    12. Dorinet, Elizavetta & Jouvet, Pierre-André & Wolfersberger, Julien, 2021. "Is the agricultural sector cursed too? Evidence from Sub-Saharan Africa," World Development, Elsevier, vol. 140(C).
    13. Apergis, Nicholas & Payne, James E., 2014. "The oil curse, institutional quality, and growth in MENA countries: Evidence from time-varying cointegration," Energy Economics, Elsevier, vol. 46(C), pages 1-9.
    14. Brunnschweiler, Christa N. & Bulte, Erwin H., 2008. "The resource curse revisited and revised: A tale of paradoxes and red herrings," Journal of Environmental Economics and Management, Elsevier, vol. 55(3), pages 248-264, May.
    15. Lotfalipour, Mohammad Reza & sargolzaie, Ali & Salehnia, Narges, 2022. "Natural resources: A curse on welfare?," Resources Policy, Elsevier, vol. 79(C).
    16. Tiba, Sofien & Frikha, Mohamed, 2019. "The controversy of the resource curse and the environment in the SDGs background: The African context," Resources Policy, Elsevier, vol. 62(C), pages 437-452.
    17. Dorinet, Elizavetta & Jouvet, Pierre-André & Wolfersberger, Julien, 2021. "Is the agricultural sector cursed too? Evidence from Sub-Saharan Africa," World Development, Elsevier, vol. 140(C).
    18. Adrian Boos & Karin Holm‐Müller, 2012. "A theoretical overview of the relationship between the resource curse and genuine savings as an indicator for “weak” sustainability," Natural Resources Forum, Blackwell Publishing, vol. 36(3), pages 145-159, August.
    19. Seghir, Majda & Damette, Olivier, 2013. "Natural resource curse: a non linear approach in a panel of oil exporting countries," MPRA Paper 51604, University Library of Munich, Germany.
    20. Ruba A. Aljarallah & Andrew Angus, 2020. "Dilemma of Natural Resource Abundance: A Case Study of Kuwait," SAGE Open, , vol. 10(1), pages 21582440198, January.
    21. Barbier,Edward B., 2007. "Natural Resources and Economic Development," Cambridge Books, Cambridge University Press, number 9780521706513.
    22. Matsen, Egil & Torvik, Ragnar, 2005. "Optimal Dutch disease," Journal of Development Economics, Elsevier, vol. 78(2), pages 494-515, December.

    More about this item

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:wpaper:hal-01527664. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.