## _wp12111 - Introduction

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---

### Overview: natural resources and MENA
- MENA contains 55 percent of global oil reserves and 29 percent of natural gas reserves (Oil and Gas Journal, 2009).
- Hydrocarbon revenues dominate many MENA economies; example: in 2008 Algeria’s hydrocarbon revenues represented 38 percent of government revenues and 98 percent of total goods exports (IMF, 2012).
- Objective: review developmental outcomes of resource-rich MENA countries over the past 40 years, place their experience in international context, and offer policy prescriptions.

### Social and labor market context
- Labor force expansion documented by the World Bank (2004): from 104 million workers in 2000 to an estimated 146 million by 2010 and expected 185 million by 2020.
- MENA has the highest level of unemployment in the world (International Labor Organization [ILO], 2012).
- Youth-to-adult unemployment ratio in 2011: 4.0 for the MENA region compared to 2.8 globally (ILO, 2012).
- Inclusive growth, not solely the rate of output growth, is central to policy and research agendas.

### Country group classification used in the analysis
- GCC group: Bahrain, Kuwait, Oman, Saudi Arabia, United Arab Emirates, and Qatar (natural resource–rich, labor-importing).
- Non-GCC group: Algeria, Iraq, Libya, and Syria (natural resource–rich, labor-abundant).
- Emerging group: Egypt, Jordan, Morocco, and Tunisia (natural resource–poor).
- Other non-Arab natural resource–rich countries included for comparison: Iran and Venezuela.

### Key thesis points
- Resource-rich MENA countries have maintained high levels of income per capita but have underperformed on non-income measures: low and noninclusive growth, high macroeconomic volatility, and concerns about quality of public goods and services.
- Success of reforms depends on investing in strong institutions and high human capacity in public administrations.

### I. MENA developmental outcomes

#### A. Rising income levels, but declining overall wealth
- Between 1970 and 2008:
  - real gross national income (GNI) per capita increased 18 times in the GCC group;
  - increased 9 times in the non-GCC group;
  - increased about 10 times in the emerging group.
- For resource-rich countries, gains in standard income measures are almost entirely due to improvements in terms of trade, with little gains from increased nonresource sector production.
- Wealth composition and sustainability:
  - Arab resource-rich countries’ wealth is mostly concentrated in natural capital (Figure 12.2).
  - Adjusting for resource depletion implies negative genuine saving rates in many cases.
  - The MENA region experienced negative genuine savings and a decline in wealth between 1975 and 2005, as opposed to East Asia where wealth increased significantly over the same period.
  - Share of natural capital in developing MENA countries amounts to over 30 percent of overall wealth versus below 10 percent for advanced countries.

#### B. Low growth and high levels of volatility
- Over the last five decades (1961–2008), both GCC and non-GCC resource-rich countries’ average per-capita GDP growth was almost zero, with output growth volatility twice as high as resource-poor countries in the region (Figure 12.4).
- Literature findings:
  - Volatility hurts growth (Aghion and Banerjee, 2005; Ramey and Ramey, 1995).
  - Revenues from natural resources transit directly to government coffers and may be prone to rent-seeking, undermining saving and investment (Arezki and Gylfason, 2012).
  - Institutions that prevent misappropriation and promote good policies moderate the impact of volatility on growth.

#### C. Mixed outcomes in financial sector development
- Evidence is mixed on financial deepening in resource-rich countries:
  - Banks in resource-rich countries are more liquid, better capitalized, and more profitable but extend fewer loans to firms (Beck, 2011).
  - Supply constraints in bank lending to firms are observed in resource-rich countries.
- Within MENA:
  - Financial development varies widely (Creane and others, 2004).
  - GCC: rapid financial sector development but subject to pronounced boom-bust cycles tied to oil prices (Figure 12.5).
  - Non-GCC: financial systems often dominated by ineffective public banks; domestic credit to private sector has lagged relative to resource-poor countries (Figure 12.6).
  - Financial deepening has not for the most part spurred economic diversification in GCC countries.

#### D. Limited economic diversification and Dutch disease
- Dutch disease channels (spending and relocation effects) explain how resource windfalls can appreciate the real exchange rate and squeeze tradable sectors.
- MENA evidence:
  - Dramatic decline in the share of agriculture and manufacturing in GDP, while resource-poor countries saw increases in the share of manufacturing (Figure 12.7).
  - Spending effect appears dominant; flexible labor markets in GCC and high unemployment in populous resource-rich countries may dampen the relocation effect.
  - Price controls on domestic fuel and food mean adjustment burdens often fall on public finances, risking fiscal sustainability.
- Political economy factors:
  - State-dominated vertical industrial policies persisted in MENA, preserving existing structures rather than fostering dynamic private-sector-led transformation (Nabli and others, 2006).
  - Weak emergence of interest groups and governance weaknesses hinder market-friendly reforms.

#### E. Institutions and governance
- Strong institutions and democracy are critical to harness natural resources for development (Acemoglu and others, 2001, 2002).
- Democracies tend to be less subject to macroeconomic instability and grow faster after resource windfalls (Arezki and others, 2011).
- Historically, MENA countries have markedly lower scores in governance and democracy indicators compared to other regions (Figure 12.12).
- International initiatives that may anchor domestic reforms include the Extractive Industries Transparency Initiative (EITI) and the Natural Resource Charter, but civil society and political actors must drive domestic reform.

### II. Policy prescriptions and priorities

#### Four main policy directions proposed
- Limit or avoid boom-bust cycles.
- Invest in human capital and other public goods while maintaining quality.
- Adapt “new” industrial policies that correct market failures and distortions created by resource wealth.
- Build appropriate and strong institutions.

#### Limiting boom-bust cycles
- Fiscal policy in resource-rich countries has tended to be procyclical (Arezki and others, 2011).
- Severe bust of the 1980s produced a growth collapse that lasted almost two decades (Figure 12.8).
- Fiscal institutions (stabilization funds or fiscal rules) have been set up in many countries, but evidence on their effectiveness is mixed:
  - Arezki (2011) found fiscal rules have not had any significant effect on procyclicality in resource-rich countries.
  - Explanations: (a) many fiscal institutions are recent (early 2000s); (b) fiscal rules can be circumvented in weak institutional environments.
  - Example: Chile successfully implemented a fiscal rule targeting a structural budget balance set by an independent panel with binding recommendations (Frankel, 2011) — potential model for adaptation.

#### Investing in human capital and infrastructure: the quality imperative
- Improvements documented in life expectancy, under-5 mortality, and average years of schooling (Figures 12.9 and 12.10).
- Observations:
  - Improvements in labor-abundant resource-rich countries were not superior to resource-poor countries in the region; GCC achieved better results than non-GCC.
  - Investment in human and physical capital has not been sufficient in magnitude or quality to offset resource depletion.
  - Public investment projects following booms in the 1970s and early 1980s were often inefficient, quickly depreciated, or became unsustainable (Gelb, 1988).
- Modeling and evidence:
  - Arezki, Dupuy, and Gelb (2012): weaker administrative capacity lowers the level of optimal public capital; higher natural resource windfalls increase adjustment costs for public investment.
  - Kyobe and others (2011): quality of public investment (public investment management index) is lower in resource-rich countries than in resource-poor countries; MENA has one of the lowest levels.
- Policy implication: invest in building administrative capacity, fight rent seeking, and develop high-level human capital in public administration to improve public investment quality and outcomes.

#### “Industrial” policies for diversification
- Need to create high-quality jobs to absorb rapid labor force growth (Figure 12.11); natural resource sectors are capital intensive and low in labor intensity.
- Recommend avoiding old-style industrial policies that protect entrenched interests.
- Promote “new-style” industrial policies addressing market and coordination failures, implemented in an open trade and investment environment (possibly gradual).
- Opportunities:
  - Leverage sovereign wealth funds (SWFs) to invest long-term in resource-poor but labor-abundant MENA countries, subject to domestic reforms improving investment climate.
- Risks: wrong policy choices waste scarce resources and foreign investments; careful design is essential to avoid rent seeking and inefficient specialization.

### III. Conclusion: priorities and institutional capacity
- Priority issues identified:
  - Better macroeconomic management to avoid procyclical policies.
  - Larger and better quality investments in human and physical capital.
  - Innovative policies to achieve diversification and economic transformation to meet employment challenges.
- These components are highly interrelated and require major institutional and governance reforms.
- Successful implementation requires:
  - Strong capacity to design, implement, and enforce rules and regulations.
  - Inclusive institutions with appropriate enforcement mechanisms.
  - High-level human capacity in public administrations.
- One of the most important investments for resource-rich countries is developing and retaining high-level managers in the public and private sectors — a lesson drawn from Chile.

*Source: _wp12111 - INTRODUCTION (IMF).*

### Introduction ...........................................................................................................

### _wp12111 - Introduction

### I. MENA Developmental Outcomes
- A. Rising Income Levels, but Declining Overall Wealth
- B.
- C. Low Growth and High Levels of Volatility
- D. Mixed Outcomes in Financial Sector Development
- Limited Economic Diversification
- Policy Prescriptions to Harness the Power of Natural Resources
- Limiting Boom-Bust Cycles
- Investing in Human Capital and Infrastructure: The Quality Imperative
- “Industrial” Policies for Diversification
  - Is there a role for industrial policies to achieve diversification?
- E. Institutions and Governance

### II. Conclusion

### References

### Figures (as listed)
- Figure 12.1 Average GNI per capita, PPP (current international $)
- Figure 12.2 Share of natural capital around the world
- Figure 12.3 Genuine saving rate by regions
- Figure 12.4 GDP per-capita growth and volatility, 1961 to 2008
- Figure 12.5 Financial market development: Average bank deposits, 1960 to 2008
- Figure 12.6 Financial market development: Mean domestic credit to private sector,
- Figure 12.7 Structure of production, 1960 to 2008
- Figure 12.8 Output fluctuations
- Figure 12.9 Average life expectancy at birth and mortality rate under 5 years
- Figure 12.10 Average years of schooling (15 years of age and older)
- Figure 12.11 Labor force growth rate, 1960 to 2008
- Figure 12.12 Tendency of democracy (mean policy index, 1960 to 2006)

*Source: _wp12111 - Introduction (PDF), page listing and figures as provided.*

### INTRODUCTION

### _wp12111 - INTRODUCTION

### Overview: natural resources and MENA
- MENA contains 55 percent of global oil reserves and 29 percent of natural gas reserves (Oil and Gas Journal, 2009).
- Hydrocarbon revenues dominate many MENA economies; for example, in 2008 Algeria’s hydrocarbon revenues represented 38 percent of government revenues and 98 percent of total goods exports (IMF, 2012).
- Objective: review developmental outcomes of resource-rich MENA countries over the past 40 years, place their experience in international context, and offer policy prescriptions.

### Social and labor market context
- Labor force expansion documented by the World Bank (2004): from 104 million workers in 2000 to an estimated 146 million by 2010 and expected 185 million by 2020.
- MENA has the highest level of unemployment in the world (International Labor Organization [ILO], 2012).
- Youth-to-adult unemployment ratio in 2011: 4.0 for the MENA region compared to 2.8 globally (ILO, 2012).
- Inclusive growth, not solely the rate of output growth, is central to policy and research agendas.

### Country group classification used in the analysis
- GCC group: Bahrain, Kuwait, Oman, Saudi Arabia, United Arab Emirates, and Qatar (natural resource–rich, labor-importing).
- Non-GCC group: Algeria, Iraq, Libya, and Syria (natural resource–rich, labor-abundant).
- Emerging group: Egypt, Jordan, Morocco, and Tunisia (natural resource–poor).
- Other non-Arab natural resource–rich countries included for comparison: Iran and Venezuela.

### Key thesis points
- Resource-rich MENA countries have maintained high levels of income per capita but have underperformed on non-income measures: low and noninclusive growth, high macroeconomic volatility, and concerns about quality of public goods and services.
- Success of reforms depends on investing in strong institutions and high human capacity in public administrations.

---

### I. MENA developmental outcomes

#### A. Rising income levels, but declining overall wealth
- Between 1970 and 2008:
  - real gross national income (GNI) per capita increased 18 times in the GCC group;
  - increased 9 times in the non-GCC group;
  - increased about 10 times in the emerging group.
- For resource-rich countries, gains in standard income measures are almost entirely due to improvements in terms of trade, with little gains from increased nonresource sector production.
- Wealth composition and sustainability:
  - Arab resource-rich countries’ wealth is mostly concentrated in natural capital (Figure 12.2).
  - Adjusting for resource depletion implies negative genuine saving rates in many cases.
  - The MENA region experienced negative genuine savings and a decline in wealth between 1975 and 2005, as opposed to East Asia where wealth increased significantly over the same period.
  - Share of natural capital in developing MENA countries amounts to over 30 percent of overall wealth versus below 10 percent for advanced countries.

#### B. Low growth and high levels of volatility
- Over the last five decades (1961–2008), both GCC and non-GCC resource-rich countries’ average per-capita GDP growth was almost zero, with output growth volatility twice as high as resource-poor countries in the region (Figure 12.4).
- Literature findings:
  - Volatility hurts growth (Aghion and Banerjee, 2005; Ramey and Ramey, 1995).
  - Revenues from natural resources transit directly to government coffers and may be prone to rent-seeking, undermining saving and investment (Arezki and Gylfason, 2012).
  - Institutions that prevent misappropriation and promote good policies moderate the impact of volatility on growth.

#### C. Mixed outcomes in financial sector development
- Evidence is mixed on financial deepening in resource-rich countries:
  - Banks in resource-rich countries are more liquid, better capitalized, and more profitable but extend fewer loans to firms (Beck, 2011).
  - Supply constraints in bank lending to firms are observed in resource-rich countries.
- Within MENA:
  - Financial development varies widely (Creane and others, 2004).
  - GCC: rapid financial sector development but subject to pronounced boom-bust cycles tied to oil prices (Figure 12.5).
  - Non-GCC: financial systems often dominated by ineffective public banks; domestic credit to private sector has lagged relative to resource-poor countries (Figure 12.6).
  - Financial deepening has not for the most part spurred economic diversification in GCC countries.

#### D. Limited economic diversification and Dutch disease
- Dutch disease channels (spending and relocation effects) explain how resource windfalls can appreciate the real exchange rate and squeeze tradable sectors.
- MENA evidence:
  - Dramatic decline in the share of agriculture and manufacturing in GDP, while resource-poor countries saw increases in the share of manufacturing (Figure 12.7).
  - Spending effect appears dominant; flexible labor markets in GCC and high unemployment in populous resource-rich countries may dampen the relocation effect.
  - Price controls on domestic fuel and food mean adjustment burdens often fall on public finances, risking fiscal sustainability.
- Political economy factors:
  - State-dominated vertical industrial policies persisted in MENA, preserving existing structures rather than fostering dynamic private-sector-led transformation (Nabli and others, 2006).
  - Weak emergence of interest groups and governance weaknesses hinder market-friendly reforms.

#### E. Institutions and governance
- Strong institutions and democracy are critical to harness natural resources for development (Acemoglu and others, 2001, 2002).
- Democracies tend to be less subject to macroeconomic instability and grow faster after resource windfalls (Arezki and others, 2011).
- Historically, MENA countries have markedly lower scores in governance and democracy indicators compared to other regions (Figure 12.12).
- International initiatives that may anchor domestic reforms include the Extractive Industries Transparency Initiative (EITI) and the Natural Resource Charter, but civil society and political actors must drive domestic reform.

---

### II. Policy prescriptions and priorities

#### Four main policy directions proposed
1. Limit or avoid boom-bust cycles.
2. Invest in human capital and other public goods while maintaining quality.
3. Adapt “new” industrial policies that correct market failures and distortions created by resource wealth.
4. Build appropriate and strong institutions.

#### Limiting boom-bust cycles
- Fiscal policy in resource-rich countries has tended to be procyclical (Arezki and others, 2011).
- Severe bust of the 1980s produced a growth collapse that lasted almost two decades (Figure 12.8).
- Fiscal institutions (stabilization funds or fiscal rules) have been set up in many countries, but evidence on their effectiveness is mixed:
  - Arezki (2011) found fiscal rules have not had any significant effect on procyclicality in resource-rich countries.
  - Explanations: (a) many fiscal institutions are recent (early 2000s); (b) fiscal rules can be circumvented in weak institutional environments.
  - Example: Chile successfully implemented a fiscal rule targeting a structural budget balance set by an independent panel with binding recommendations (Frankel, 2011) — potential model for adaptation.

#### Investing in human capital and infrastructure: the quality imperative
- Improvements documented in life expectancy, under-5 mortality, and average years of schooling (Figures 12.9 and 12.10).
- Observations:
  - Improvements in labor-abundant resource-rich countries were not superior to resource-poor countries in the region; GCC achieved better results than non-GCC.
  - Investment in human and physical capital has not been sufficient in magnitude or quality to offset resource depletion.
  - Public investment projects following booms in the 1970s and early 1980s were often inefficient, quickly depreciated, or became unsustainable (Gelb, 1988).
- Modeling and evidence:
  - Arezki, Dupuy, and Gelb (2012): weaker administrative capacity lowers the level of optimal public capital; higher natural resource windfalls increase adjustment costs for public investment.
  - Kyobe and others (2011): quality of public investment (public investment management index) is lower in resource-rich countries than in resource-poor countries; MENA has one of the lowest levels.
- Policy implication: invest in building administrative capacity, fight rent seeking, and develop high-level human capital in public administration to improve public investment quality and outcomes.

#### “Industrial” policies for diversification
- Need to create high-quality jobs to absorb rapid labor force growth (Figure 12.11); natural resource sectors are capital intensive and low in labor intensity.
- Recommend avoiding old-style industrial policies that protect entrenched interests.
- Promote “new-style” industrial policies addressing market and coordination failures, implemented in an open trade and investment environment (possibly gradual).
- Opportunities:
  - Leverage sovereign wealth funds (SWFs) to invest long-term in resource-poor but labor-abundant MENA countries, subject to domestic reforms improving investment climate.
- Risks: wrong policy choices waste scarce resources and foreign investments; careful design is essential to avoid rent seeking and inefficient specialization.

---

### III. Conclusion: priorities and institutional capacity
- Priority issues identified:
  1. Better macroeconomic management to avoid procyclical policies.
  2. Larger and better quality investments in human and physical capital.
  3. Innovative policies to achieve diversification and economic transformation to meet employment challenges.
- These components are highly interrelated and require major institutional and governance reforms.
- Successful implementation requires:
  - Strong capacity to design, implement, and enforce rules and regulations.
  - Inclusive institutions with appropriate enforcement mechanisms.
  - High-level human capacity in public administrations.
- One of the most important investments for resource-rich countries is developing and retaining high-level managers in the public and private sectors — a lesson drawn from Chile.

*Source: _wp12111 - INTRODUCTION (IMF).*

### REFERENCES

### REFERENCES

### Major themes and cited works on resource wealth, Dutch disease, and diversification
- Al-Hassan, Abdullah, Mohammed Omran, and Fernando Luciano Delgado Fernandez, 2007, IPO Behavior in GCC Countries: Goody-Two Shoes or Bad-to-the-Bone?, IMF Working Paper 07/149.
- Arezki, R., and K. Ismail, 2010, Boom-Bust Cycle, Asymmetrical Fiscal Response and the Dutch Disease, IMF Working Paper 10/94.
- Arezki, R., K. Hamilton, and K. Kazimov, 2011, Resource Windfalls, Macroeconomic Stability and Economic Growth, IMF Working Paper 11/142.
- Arezki, R., “Fiscal Policy in Commodity Exporting Countries: Stability and Economic Growth,” in Beyond the Curse: Policies to Harness the Power of Natural Resources, ed. by R. Arezki, T. Gylfason, and A. Sy, International Monetary Fund.
- Arezki, R., and Thorvaldur Gylfason, 2011, “Commodity Price Volatility, Democracy and Economic Growth,” in Frontiers of Economics and Globalization, Economic Growth and Development, ed. by Olivier de La Grandville, (Bingley, UK: Emerald Group), pp. 9–24.
- Arezki, R., A. Dupuy, and A. Gelb, 2012, Optimal Public Investment in Resource Rich Countries: The Role of Business Climate and Administrative Capacity, forthcoming IMF Working Paper.
- Auty, Richard, 2001, Resource Abundance and Economic Development, World Institute for Development Economics Research, (UK: Oxford University Press).
- Gelb, Alan, and others, 1988, Oil Windfalls: Blessing or Curse? (New York: Oxford University Press).
- Gelb, Alan, 2011, “Economic Diversification in Resource Rich Countries,” in Beyond the Curse: Policies to Harness the Power of Natural Resources, ed. by R. Arezki, T. Gylfason, and A. Sy, International Monetary Fund.
- Gelb, Alan, 2012, “Economic Diversification and the Role of the Government in Resource-Rich Economies,” presentation at the Economic Research Forum Conference on Understanding and Avoiding the Curse in the Arab World, January 2012, Kuwait.
- Wijnbergen van, S., 1984, “The Dutch Disease: A Disease After All?” The Economic Journal, Vol. 94, pp. 373–341.
- Ossowski, R., M. Villafuerte, P. A. Medas, and T. Thomas, 2008, “Managing the Oil Revenue Boom: The Role of Fiscal Institutions,” IMF Occasional Paper 08/260, International Monetary Fund.

### Empirical and theoretical literature on institutions, development, and the resource curse
- Acemoglu, Daron, Simon Johnson, and James Robinson, 2001, “The Colonial Origins of Comparative Development: An Empirical Investigation,” American Economic Review, Vol. 91, pp. 1369–1401.
- Acemoglu, Daron, Simon Johnson, and James Robinson, 2002, “Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution,” Quarterly Journal of Economics, Vol. 117, pp. 1231–1294.
- Acemoglu, D., and J. Robinson, 2012, Why Nations Fail: The Origins of Power of Power, Prosperity, and Poverty, (New York: Crown Publishers).
- Gylfason, T., 2001, “Natural Resources, Education, and Economic Development,” European Economic Review, Vol. 45, pp. 847–859.
- Melhum, H., K. Moene, and R. Torvik, 2006, “Institutions and the Resource Curse,” Economic Journal, Vol. 116, pp. 1–20.
- Isham, J. L., P. M. Woolcock, and G. Busby, 2005, “The Varieties of Resource Experience: Natural Resource Export Structures and the Political Economy of Economic Growth,” World Bank Economic Review, Vol. 19, pp. 141–174.
- Persson, T., 2002, “Do Political Institutions Shape Economic Policy.” Econometrica, Vol. 70, pp. 883–905.
- Sachs, J. D., and Warner, A. M., 1995, “Natural Resource Abundance and Economic Growth,” NBER Working Paper No. 5398 (Cambridge, Massachusetts: National Bureau of Economic Research), http://papers.nber.org/papers/w5398.
- Sachs, J. D., and Andrew Warner, 2001, “The Curse of Natural Resources,” European Economic Review, Vol. 45, No. 4–6 (May), pp. 827–838.
- Hartwick, J. M., 1977, “Intergenerational Equity and the Investing of Rents from Exhaustible Resources,” American Economic Review, Vol. 66, pp. 972–74.

### Volatility, growth, and macroeconomic stability literature
- Aghion, P., and A. Banerjee, 2005, Volatility and Growth, (Oxford and New York: Oxford University Press).
- Ramey, Garey, and Valerie A. Ramey, 1995, “Cross-Country Evidence on the Link between Volatility and Growth,” American Economic Review, Vol. 85, pp. 1138–1151.
- Arezki, R., and Thorvaldur Gylfason, 2011, “Commodity Price Volatility, Democracy and Economic Growth,” in Frontiers of Economics and Globalization, Economic Growth and Development, ed. by Olivier de La Grandville, (Bingley, UK: Emerald Group), pp. 9–24.
- Goderis, B., and S. W. Malone, 2008, Natural Resource Booms and Inequality: Theory and Evidence, OxCarre Working Paper No. 008 (Oxford, UK: Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford).

### Policy prescriptions, fiscal frameworks, and public investment
- Frankel, J., 2011, “How Can Commodity Exporters Make Fiscal and Monetary Policy Less Procyclical?” in Beyond the Curse: Policies to Harness the Power of Natural Resources, ed. by R. Arezki, T. Gylfason, and A. Sy, International Monetary Fund.
- Frankel, J., 2012, “The Natural Resource Curse: A Survey of Diagnoses and Some Prescriptions,” in Commodity Prices and Inclusive Growth in Low-Income Countries, ed. by Rabah Arezki, Catherine Pattillo, Marc Quintyn, and Min Zhu, International Monetary Fund.
- Beck, Thorsten, 2011, “Oil and Finance: Is There a Resource Curse?” in Beyond the Curse: Policies to Harness the Power of Natural Resources, ed. by R. Arezki, T. Gylfason, and A. Sy, International Monetary Fund.
- Kyobe, Annette, Jim Brumby, Chris Papageorgiou, Zac Mills, and Era Dabla-Norris, 2011, Investing in Public Investment: An Index of Public Investment Efficiency, IMF Working Paper 11/37.
- Arezki, R., A. Dupuy, and A. Gelb, 2012, Optimal Public Investment in Resource Rich Countries: The Role of Business Climate and Administrative Capacity, forthcoming IMF Working Paper.
- Heuty, A., 2012, “The Role of Transparency and Civil Society in Managing Commodities for Inclusive Growth and Development,” in Commodity Prices and Inclusive Growth in Low-Income Countries, ed. by Rabah Arezki, Catherine Pattillo, Marc Quintyn, and Min Zhu, International Monetary Fund.
- Warner, Andrew, 2012, “Inclusive Growth in Natural Resource Intensive Countries” in Commodity Prices and Inclusive Growth in Low-Income Countries, ed. by Rabah Arezki, Catherine Pattillo, Marc Quintyn, and Min Zhu, International Monetary Fund.
- Arezki, R., “Fiscal Policy in Commodity Exporting Countries: Stability and Economic Growth,” in Beyond the Curse: Policies to Harness the Power of Natural Resources, ed. by R. Arezki, T. Gylfason, and A. Sy, International Monetary Fund.

### Inequality, conflict risk, and labor markets with regional focus
- Bibi, Sami, and Mustapha K. Nabli, 2009, “Income Inequality in the Arab Region: Data and Measurement, Patterns and Trends,” Middle East Development Journal, Vol. 1, No. 02, pp. 275–314.
- Ross, M. L., 2007, “How Mineral-Rich States Can Reduce Inequality,” in Escaping the Resource Curse, ed. by M. Humphreys, J. D. Sachs, and J. E. Stiglitz (New York: Columbia University Press).
- Ross, Michael, Nimah Mazaheri, and Kai Kaiser, 2011, “The ‘Resource Curse’ in MENA? Resource Wealth, Economic Shocks, and Conflict Risk,” World Bank Policy Research Working Paper No. 5742, July 2011 (Washington: World Bank).
- Ross, Michael, 2012, “The Political Economy of Petroleum Wealth in Low-Income Countries: Some Policy Alternatives,” in Commodity Prices and Inclusive Growth in Low-Income Countries, ed. by Rabah Arezki, Catherine Pattillo, Marc Quintyn, and Min Zhu, International Monetary Fund.
- Awadallah, Bassem, and Adeel Malik, 2011, The Economics of the Arab Spring, Center for the Study of African Economies (CSAE) Working Paper WPS/2011 23 (Oxford, UK: CSAE).
- ILO, 2012, Global Employment Trends 2012: Preventing a Deeper Jobs Crisis (Geneva, Switzerland: International Labor Organization).
- World Bank, 2004, Unlocking the Employment Potential in the Middle East and North Africa, pp. 1–262 (Washington: World Bank).

### Financial sector development, IPOs, and regional industrial policy
- Creane, Susan, Rishi Goyal, A. Mushfiq Mobarak, and Randa Sab, 2004, Financial Sector Development in the Middle East and North Africa, IMF Working Paper 04/201.
- Al-Hassan, Abdullah, Mohammed Omran, and Fernando Luciano Delgado Fernandez, 2007, IPO Behavior in GCC Countries: Goody-Two Shoes or Bad-to-the-Bone?, IMF Working Paper 07/149.
- Nabli, Mustapha K., Jennifer Keller, Claudia Nassif, and Carlos Silva-Jauregui, 2005, “The Political Economy of Industrial Policy in The Middle East and North Africa,” presented at the ECES Conference: Rethinking the Role of the State: An Assessment of Industrial Policy in MENA, November, Cairo.

### Data sources, manuals, and datasets cited
- Oil and Gas Journal Data Book, 2009 (Tulsa, Oklahoma: PennWell Books).
- Marshall, M., and K. Jaggers, 2010, “Polity IV Project: Dataset Users’ Manual,” Algeria 2010 Article IV Consultation, February 2011, International Monetary Fund, www.cidcm.umd.edu/polity.
- World Bank, 2010, World Development Indicators (Washington: World Bank).
- World Bank, 2006, “Where is the Wealth of Nations?” (Washington: World Bank).
- World Bank, 2011, “The Changing Wealth of Nations” (Washington: World Bank).

*References as listed in the source document.*

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_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2012/_wp12111.pdf_