Many developing countries periodically face large adverse shocks to their economies. We study two distinct types of such shocks - large declines in the price of a country’s commodity exports and severe natural disasters - , both of which have occurred frequently in the recent past....

Currently, evidence on the ‘resource curse’ yields a conundrum. While there is much crosssection evidence to support the curse hypothesis, time series analyses using vector autoregressive (VAR) models have found that commodity booms raise the growth of commodity exporters. This paper adopts...

Surprisingly little is known about the impact resource booms on income inequality in resource rich countries (Ross, 2007). This paper develops a simple theory, in the context of a two sector growth model in which learning-by-doing drives growth, to explain the time path of inequality following a...

A recent paper by Kraay (2003) documents the lack of any systematic association between monetary policy and the outcome of a speculative attack. This paper extends Kraay’s work by introducing an improved measure of monetary policy and an additional country-specific fundamental, short-term...

This paper investigates the role of aid in mitigating the adverse effects of commodity export price shocks on growth in commodity-dependent countries. Using a large crosscountry dataset, we find that negative shocks matter for short-term growth, while the ex ante risk of shocks does not seem to...

Currently, evidence on the ‘resource curse’ yields a conundrum. While there is much crosssection evidence to support the curse hypothesis, time series analyses using vector autoregressive (VAR) models have found that commodity booms raise the growth of commodity exporters. This paper adopts...

In this paper we investigate how a wide array of types of shock arising from world prices, natural events, and political violence affect growth. Our results suggest that the impact from political shocks are far greater than from natural shocks. However, our preliminary cointegration results...

Currently, evidence on the ‘resource curse’ yields a conundrum. While there is much crosssection evidence to support the curse hypothesis, time series analyses using vector autoregressive (VAR) models have found that commodity booms raise the growth ofcommodity exporters. This paper adopts...

This paper investigates the role of aid in mitigating the adverse effects of commodity export price shocks on growth in commodity-dependent countries. Using a large cross-country dataset, we find that negative shocks matter for short-term growth, while the ex ante risk of shocks does not seem to...