The Long Run Dynamic of the Dutch Disease Phenomenon: A SVAR Approach
19 Pages Posted: 18 Mar 2013
Date Written: March 1, 2013
This paper studies the dynamic eﬀect of oil rents on industrial added value in a sample of countries with diﬀerent levels of development. Using a SVAR model, we tested the eﬀect of a real shock and a nominal shock on the variables of the model. The main obtained results are three. First, we conﬁrmed that the Dutch disease (DD) problem is a short-term phenomenon that takes place each time there is a shock on oil rents. Second, the ephemeral nature of the phenomenon conﬁrms the neoclassical assumption stating that the effect of nominal shocks on real variables is only short term. Third, the eﬀect of long-term real shock on oil rents is positive for all countries which score interdependence between industry on the one hand and oil rents on the other.
Keywords: Dutch disease, Oil rents, Industrial added value, SVAR, Tunisia
JEL Classification: E10, E12, E13
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