 An investigation of a partial Dutch disease in BotswanaTamás Barczikay, Zsuzsánna Biedermann and László Szalai Resources Policy, 2020, vol. 67, issue C Abstract: Diversification of resource-driven economies has proven to be a very stubborn problem. Even relatively successful countries struggle to achieve a structural change towards manufacturing and high-tech industries. Botswana has been often cited as one of the few countries that escaped the resource curse and performed well in terms of economic growth. However, a significant share of the domestic output and most of the exports are still coming from the mining sector. In this paper we present the spending effect as a possible explanation for the lack of economic diversity. Using a nonlinear autoregressive distributed lag model, we investigate the cointegration of the diamond price index and the pula exchange rate against the currencies of Botswana's main trading partners on monthly time-series data. Our analysis is based on a recent dataset that covers the period from the introduction of the crawling band exchange regime until 2018. The results highlight a partial Dutch disease phenomenon related to Botswana's trade union partners: Namibia and South Africa. Keywords: Diversification; Resource curse; Spending effect; Real exchange rate; Asymmetric cointegration; Nonlinear autoregressive distributed lag model (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:67:y:2020:i:c:s0301420719309055 DOI: 10.1016/j.resourpol.2020.101665 Access Statistics for this article Resources Policy is currently edited by R. G. Eggert More articles in Resources Policy from Elsevier |
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