Diagnosing Dutch Disease: Does Russia Have the Symptoms?

42 Pages Posted: 20 Jul 2007

See all articles by Nienke Oomes

Nienke Oomes

International Monetary Fund (IMF)

Katerina Kalcheva

Morgan Stanley

Multiple version iconThere are 2 versions of this paper

Date Written: April 4, 2007

Abstract

In this paper, we assess whether recent economic developments in Russia are symptomatic of Dutch Disease. We first provide a brief review of the literature on Dutch Disease and the natural resource curse. We then discuss the symptoms of Dutch Disease, which include (1) real exchange rate appreciation; (2) slower manufacturing growth; (3) faster service sector growth; and (4) higher overall wages. We test these predictions for Russia while carefully controlling for other factors that could have led to similar symptoms. We conclude that, while Russia has all of the symptoms, the diagnosis of Dutch Disease remains to be confirmed.

Keywords: Dutch disease, real exchange rate, resource curse, Russia, oil, transition

JEL Classification: F30, P28, Q30

Suggested Citation

Oomes, Nienke and Kalcheva, Katerina, Diagnosing Dutch Disease: Does Russia Have the Symptoms? (April 4, 2007). BOFIT Discussion Paper No. 7/2007. Available at SSRN: https://ssrn.com/abstract=1001659 or http://dx.doi.org/10.2139/ssrn.1001659

Nienke Oomes (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Katerina Kalcheva

Morgan Stanley ( email )

1585 Broadway
New York, NY 10036
United States

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