A temporary windfall of foreign aid or natural resource revenues poses interesting policy challenges. Should the revenues be used for government investment in public infrastructure to stimulate economic activity? Should the government use the windfall income to reduce government debt and thereby lower interest rates and boost private sector investment?
Absorbing a windfall of foreign exchange: Dutch disease dynamics
Rick van der Ploeg, Anthony Venables, 1 November 2010
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URL: www.cepr.org/pubs/dps/DP8086.asp
Topics: Exchange rates
Tags: absorption constraints, absorptive capacity, aid, Dutch disease, natural resources, Windfall revenues
- 6843 reads
Harnessing windfall revenues in developing economies
Rick van der Ploeg, Anthony Venables, 2 October 2008
Topics: Development, Macroeconomic policy
Tags: sovereign wealth funds, Windfall revenues
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