The paper provides an alternative explanation for the "resource curse" based on the income effect resulting from high government current spending in resource rich economies. Using a simple life cycle framework, we show that private investment in the non-resource sector is adversely affected if...

This paper introduces a tractable capital market friction mechanism that allows a break of the parity between domestic and external interest rates and generates a gradual evolution of capital stock and other macroeconomic variables-in contrast to the instantaneous convergence found in models...

A defining feature of transition economies is the expansion of the private sector. Motivated by the observation that new enterprises in transition economies seem to have a strong preference for recruiting young people, this paper studies intergenerational redistribution following from market...

This volume examines the impact on economic performance of structural policies-policies that increase the role of market forces and competition in the economy, while maintaining appropriate regulatory frameworks. The results reflect a new dataset covering reforms of domestic product markets,...

The empirical study shows that the equilibrium real exchange rate in Mauritius has been affected by the terms of trade, as well as by other fundamental determinants. It assesses the challenges posed to Mauritius’s trade performance by the expiration of the preferential trade arrangements....

This 2007 Article IV Consultation highlights that Malta’s economic recovery is gaining traction, owing in large part to cyclical strength and some structural change. A public investment boom, financed largely by grants from the European Union, reignited growth in 2005. A modest recovery...

This paper analyzes Bolivia’s growth performance with a focus on the regional and sectoral patterns of growth, and examines the sources of growth. It discusses the evolution of the hydrocarbon sector, its importance in the economy, and reforms. It also analyzes the intergovernmental...

This paper discusses 2013 Article IV Consultation highlights slower economic performance and financial risks in Botswana. The output growth is expected to remain broadly unchanged in 2013 as strong nonmining sector growth would offset the subdued mining output. Banks’ high exposure to...

Strong fundamentals and countercyclical policies have helped Malaysia during the global financial crisis. Executive Directors welcomed the authorities' challenge to make progress toward economic growth and structural transformation. Directors welcomed the consolidation effort in the 2010 budget,...

This Selected Issues paper discusses Ireland’s trade and financial linkages with key partner countries. The paper uses a vector autoregression to examine the impact of shocks to partner country GDP and shocks to Irish competitiveness on Irish GDP. Two main findings are that shocks to U.S....