Are Diamonds Forever? Using the Permanent Income Hypothesis to Analyze Botswana’s Reliance on Diamond Revenue

Olivier Basdevant

No 2008/080, IMF Working Papers from International Monetary Fund

Abstract: This study assesses the sustainability of Botswana’s diamond-related fiscal revenue. Diamond reserves are not adequate to generate enough permanent revenue to sustain a high level of expenditure. Under the current fiscal rule that no debt may be accumulated, Botswana will have to save more to avoid an abrupt adjustment in the medium term.

Keywords: WP; revenue; resource; income (search for similar items in EconPapers)
Pages: 13
Date: 2008-03-01
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Citations: View citations in EconPapers (8)

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