Are Diamonds Forever? Using the Permanent Income Hypothesis to Analyze Botswana’s Reliance on Diamond Revenue
March 1, 2008
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Summary
This study assesses the sustainability of Botswana’s diamond-related fiscal revenue. Diamond reserves are not adequate to generate enough permanent revenue to sustain a high level of expenditure. Under the current fiscal rule that no debt may be accumulated, Botswana will have to save more to avoid an abrupt adjustment in the medium term.
Subject: Expenditure, Fiscal consolidation, Fiscal rules, GDP measurement, Personal income
Keywords: income, resource, revenue, WP
Pages:
13
Volume:
2008
DOI:
Issue:
080
Series:
Working Paper No. 2008/080
Stock No:
WPIEA2008080
ISBN:
9781451869415
ISSN:
1018-5941
