Fiscal Sustainability with Non-Renewable Resources
Electronic Access:
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Summary:
This paper assesses sustainable fiscal behavior in an economy where wealth is derived predominantly from a non-renewable resource. It explores the issue in a simple dynamic framework that highlights the structural weaknesses in the underlying budgetary position, takes into account the rate of depletion of a country’s natural resource base, and examines the impact of changes in a country’s terms of trade. An alternative indicator of fiscal sustainability is derived, and the principal factors determining sustainability are identified. The results of the analysis are applied to Venezuela and Kuwait.
Series:
Working Paper No. 1998/026
Subject:
Environment Fiscal policy Fiscal stance International trade National accounts Natural resources Personal income Terms of trade
English
Publication Date:
March 1, 1998
ISBN/ISSN:
9781451844351/1018-5941
Stock No:
WPIEA0261998
Pages:
36
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