The Resource Curse and Fiscal Policy Volatility

Michael Bleaney and Håvard Halland

Discussion Papers from University of Nottingham, CREDIT

Abstract: Using data from 1980 to 2004, we show that greater fiscal policy volatility acts as a transmission mechanism for the ‘resource curse’. Resource exports dominate political and institutional variables as determinants of fiscal policy volatility, with fiscal policy volatility being a significant determinant of growth. The existence of a resource curse is confirmed, in the sense that a higher ratio of natural resource exports to total merchandise exports is associated with significantly slower per capita GDP growth. There are no statistically significant differences between the effects of point-source and diffuse resource exports.

Keywords: Fiscal policy; growth; resource curse. (search for similar items in EconPapers)
Date: 2009-09
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:not:notcre:09/09

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