OECD Development Centre Working Papers

ISSN :
1815-1949 (online)
DOI :
10.1787/18151949
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The OECD Development Centre links OECD members with developing and emerging economies and fosters debate and discussion to seek creative policy solutions to emerging global issues and development challenges. This series of working papers is intended to disseminate the OECD Development Centre’s research findings rapidly among specialists in the field concerned. These papers are generally available in the original English or French, with a summary in the other language.
 

The Macro Management of Commodity Booms

Africa and Latin America's Response to Asian Demand You or your institution have access to this content

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Author(s):
Rolando AvendaƱo1, Helmut Reisen, Javier Santiso1
Author Affiliations
  • 1: OECD, France

Publication Date
01 Aug 2008
Bibliographic information
No.:
270
Pages
40
DOI
10.1787/240356635678

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Strong growth in China and India has led to improvements in raw-material exporting countries' terms of trade and attracted complementary finance. The long-term challenge for these countries, where institutions are often fragile, is to avoid the so-called "resource curse". This paper aims to provide a comparative perspective between policy choices in commodity-exporting countries, contrasting the experiences of Africa and Latin America. First, it highlights global macroeconomic links between the Asian Drivers (China and India) and these regions. Second, it discusses optimal policy responses from a macroeconomic and institutional perspective. Third, it presents empirical evidence on macroeconomic, particularly fiscal responses to Dutch disease and the specialisation effects caused by Asian Drivers' demand and assesses the benefits and challenges offered by the Asian Drivers from a macro perspective for both Africa and Latin America.
Keywords:
Asian drivers, Latin America, commodity booms, Africa, dutch disease
JEL Classification:
  • E62: Macroeconomics and Monetary Economics / Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook / Fiscal Policy
  • F00: International Economics / General / General
  • O11: Economic Development, Technological Change, and Growth / Economic Development / Macroeconomic Analyses of Economic Development
  • O57: Economic Development, Technological Change, and Growth / Economywide Country Studies / Comparative Studies of Countries