Commodity dependence and fiscal capacity
Mauricio Cardenas (),
Santiago Ramírez and
Didem Tuzemen ()
No RWP 11-08, Research Working Paper from Federal Reserve Bank of Kansas City
This paper shows that higher commodity dependence reduces the government's incentive to invest in fiscal capacity. After developing a model that makes this prediction, evidence is provided supporting the view that countries more dependent on commodities (whose rents can be easily appropriated by the government, such as oil) have weaker fiscal capacity. Also, fiscal capacity is found to improve less over time in commodity dependent countries relative to countries where commodity exports play a less relevant role. These empirical results are obtained in a panel dataset with estimators that address endogeneity issues.
New Economics Papers: this item is included in nep-cwa
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to www.kansascityfed.org:443 (http://www.kansascityfed.org/publicat/reswkpap/pdf/rwp11-08.pdf [302 Redirect]--> https://www.kansascityfed.org/publicat/reswkpap/pdf/rwp11-08.pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedkrw:rwp11-08
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in Research Working Paper from Federal Reserve Bank of Kansas City Contact information at EDIRC.
Bibliographic data for series maintained by Lu Dayrit ().