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We study the impact of natural resource royalties on educational outcomes in Colombia. We analyze a reform enacted in … 2012 that made the distribution of these royalties more equitable. Before the reform, most royalties were assigned to the … regions where the natural resources were exploited; with the reform non-producing regions started to receive royalties. We …
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The response of an economy to a windfall of foreign exchange (be it aid or natural resource revenues) is often constrained by absorptive capacity. We provide a micro-founded analysis of absorption constraints, based on the idea that expanding the economy’s capital stock (in aggregate or...
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The prescription of optimally managing natural resource revenue windfalls by smoothing consumption across generations using an intergenerational sovereign wealth fund that only invests in foreign assets is not appropriate for resource-rich developing economies. It is better for these economies...
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