The Impact of Natural Resource Discoveries in Latin America and the Caribbean : A Closer Look at the Case of Bolivia

Author/Editor:

Frederik G Toscani

Publication Date:

February 10, 2017

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

This paper studies the impact of natural resource extraction in Latin America and the Caribbean (LAC) from a number of angles. First, we exploit a novel dataset on the universe of giant oil and gas discoveries in the region to trace out the cyclical response of macroeconomic variables to discoveries over the short- and medium-run. Second, we use non-stationary panel data techniques to look at the long-run (trend) relationship between GDP per capita and the value of oil and gas production—our results imply that the recent fall in prices could depress GDP per capita by several percentage points. Last, we use Bolivia, which discovered huge gas reserves in the late 1990s, as a case study to apply the cross-country results and to study the impact of discoveries at the subnational level.

Series:

Working Paper No. 17/27

Subject:

English

Publication Date:

February 10, 2017

ISBN/ISSN:

9781475577570/1018-5941

Stock No:

WPIEA2017027

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

35

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