How to order
IMF Publications

Working Papers in full text
2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 All


Other research-related activities and publications of the IMF can be found at IMF Research

Free Email Notification

Receive emails when we post new items of interest to you.

Subscribe or Modify your profile



Commodity Price Shocks and Fiscal Outcomes

Author/Editor: Spatafora, Nicola | Samaké, Issouf
Authorized for Distribution: May 1, 2012
Electronic Access: Free Full Text (PDF file size is 702KB)
Use the free Adobe Acrobat Reader to view this PDF file.
 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.

Summary: The experience of developing countries over 1990-2010 indicates that commodity prices have a significant impact on fiscal outcomes. Both revenue and expenditure rise in response to commodity (import or export) price increases; the response of the fiscal deficit is ambiguous. A floating exchange rate regime only partially offsets the impact; foreign-exchange reserves do not dampen the effects. Hence, there is a strong case for fiscal hedging against commodity price shocks. Hedging instruments based on a limited set of benchmark world prices for a narrow set of commodities may suffice to realize most of the potential benefits.
 
Order a print copy
Series: Working Paper No. 12/112
Subject(s): Commodity prices | Exchange rate regimes | External shocks | Fiscal policy | Floating exchange rates | Low-income developing countries
Author's keyword(s): Commodity Prices | Commodity Booms | Fiscal Policy | Hedging
 
English  
    Published:   May 1, 2012        
            Format:   Paper
    Stock No:   WPIEA2012112   Pages:   47
    Price:   US$18.00 (Academic Rate: US$18.00 )
       
     
Please address any questions about this title to publications@imf.org.