Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?

Fiscal indicators for resource-rich and resource-poor low- and middle-income countries are compared using annual data from 1996 to 2012. Resource richness is defined by export composition: fuel greater than a 25 percent share and/or ores and metals...

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Main Authors:	Bleaney, Michael, Halland, Havard
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2016
Subjects:	DEFICIT MONETARY POLICY RISKS UNCERTAINTIES ECONOMIC GROWTH OIL PRICE FISCAL BALANCES RELATIVE PRICE HARD PEG FINANCIAL MANAGEMENT STOCK FOREIGN INVESTORS FISCAL DEFICITS COUNTRY FIXED EFFECTS INTEREST DUMMY VARIABLES SEIGNIORAGE REGIME CLASSIFICATION EXCHANGE GOVERNMENT REVENUES MACROECONOMIC POLICY DEVELOPING COUNTRIES CURRENCY UNION EXPORTERS PEG DUMMY REVENUES POSITIVE COEFFICIENT INFLATION TARGETING FISCAL POLICY HIGH INFLATION PEGS TAX DUMMY VARIABLE HARD PEGS INFLATION INTERNATIONAL BANK POLITICAL RISKS BUDGET GOVERNMENT SAVING AMOUNT OF CAPITAL STANDARD DEVIATION OIL PRICES CURRENCY PRICE DYNAMICS PRICE VOLATILITY SURPLUS GLOBALIZATION MONETARY FUND DEBT MARKETS SEIGNIORAGE REVENUE RETURN DEFICITS INTERNATIONAL DEVELOPMENT CONSUMPTION EXPENDITURE BUDGET DEFICIT EXPENDITURE INCREASE RESERVES NATURAL RESOURCES GROSS DOMESTIC PRODUCT SERIAL CORRELATION FINANCE PEG PUBLIC INVESTMENT TAXES FISCAL DEFICIT INVESTMENT DECISIONS EXPENDITURE EXCHANGE-RATE INVESTORS CONSUMPTION SURPLUSES GOOD TOTAL EXPORTS COUNTRY RISK SLOW GROWTH BUDGET SURPLUS FUTURE HARD PEG DUMMY LEGAL TENDER EXPROPRIATION RISK DEPENDENT VARIABLE RETURNS PRICE OF OIL FOREIGN INVESTMENT DEMAND GOVERNMENT EXPENDITURE EXPORT SHARES INVESTMENT PROJECTS DEPENDENT VARIABLES PRICE CHANGES GOVERNMENT REVENUE EXPENDITURES PRICE FLUCTUATIONS PROPERTIES ZERO WEIGHT SHARES ASSETS MARKET INVESTMENT CHOICES PRICE INCREASE PUBLIC DEBT EXPORTER REGRESSION ANALYSIS FIXED EFFECTS PERMANENT INCOME HYPOTHESIS EXPROPRIATION GOVERNMENT POLICIES WEIGHT BILL CONSUMPTION SMOOTHING GOODS INVESTOR CURRENCY BOARD INVESTMENT NATURAL RESOURCE RISK RANDOM WALK SHARE FINANCIAL MARKETS SUPPLY POLITICAL STABILITY FISCAL BALANCE UNCERTAINTY REVENUE INVESTMENTS COMMODITY MARKET RAPID GROWTH EXCHANGE RATE FISCAL DISCIPLINE GOVERNMENT INVESTMENT PIH PUBLIC SPENDING COMMODITY PRICES MACROECONOMIC PERFORMANCE WEIGHTS INVESTMENT BOOM EXPORT SHARE WORLD MARKET POLITICAL INSTABILITY EXCHANGE RATE REGIMES FISCAL POSITION POLITICAL RISK ECONOMIES DEBT RELIEF
Online Access:	http://documents.worldbank.org/curated/en/2016/02/25860947/resource-rich-countries-suffer-lack-fiscal-discipline http://hdl.handle.net/10986/23727

id	okr-10986-23727
recordtype	oai_dc
spelling	okr-10986-237272021-06-14T10:19:05Z Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline? Bleaney, Michael Halland, Havard DEFICIT MONETARY POLICY RISKS UNCERTAINTIES ECONOMIC GROWTH OIL PRICE FISCAL BALANCES RELATIVE PRICE HARD PEG FINANCIAL MANAGEMENT STOCK FOREIGN INVESTORS FISCAL DEFICITS COUNTRY FIXED EFFECTS INTEREST DUMMY VARIABLES SEIGNIORAGE REGIME CLASSIFICATION EXCHANGE GOVERNMENT REVENUES MACROECONOMIC POLICY DEVELOPING COUNTRIES CURRENCY UNION EXPORTERS PEG DUMMY REVENUES POSITIVE COEFFICIENT INFLATION TARGETING FISCAL POLICY HIGH INFLATION PEGS TAX DUMMY VARIABLE HARD PEGS INFLATION INTERNATIONAL BANK POLITICAL RISKS BUDGET GOVERNMENT SAVING AMOUNT OF CAPITAL STANDARD DEVIATION OIL PRICES CURRENCY PRICE DYNAMICS PRICE VOLATILITY SURPLUS GLOBALIZATION MONETARY FUND DEBT MARKETS SEIGNIORAGE REVENUE RETURN DEFICITS INTERNATIONAL DEVELOPMENT CONSUMPTION EXPENDITURE BUDGET DEFICIT EXPENDITURE INCREASE RESERVES NATURAL RESOURCES GROSS DOMESTIC PRODUCT SERIAL CORRELATION FINANCE PEG PUBLIC INVESTMENT TAXES FISCAL DEFICIT INVESTMENT DECISIONS EXPENDITURE EXCHANGE-RATE INVESTORS CONSUMPTION SURPLUSES GOOD TOTAL EXPORTS COUNTRY RISK SLOW GROWTH BUDGET SURPLUS FUTURE HARD PEG DUMMY LEGAL TENDER EXPROPRIATION RISK DEPENDENT VARIABLE RETURNS PRICE OF OIL FOREIGN INVESTMENT DEMAND GOVERNMENT EXPENDITURE EXPORT SHARES INVESTMENT PROJECTS DEPENDENT VARIABLES PRICE CHANGES GOVERNMENT REVENUE EXPENDITURES PRICE FLUCTUATIONS PROPERTIES ZERO WEIGHT SHARES ASSETS MARKET INVESTMENT CHOICES PRICE INCREASE PUBLIC DEBT EXPORTER REGRESSION ANALYSIS FIXED EFFECTS PERMANENT INCOME HYPOTHESIS EXPROPRIATION GOVERNMENT POLICIES WEIGHT BILL CONSUMPTION SMOOTHING GOODS INVESTOR CURRENCY BOARD INVESTMENT NATURAL RESOURCE RISK RANDOM WALK SHARE FINANCIAL MARKETS SUPPLY POLITICAL STABILITY FISCAL BALANCE UNCERTAINTY REVENUE INVESTMENTS COMMODITY MARKET RAPID GROWTH EXCHANGE RATE FISCAL DISCIPLINE GOVERNMENT INVESTMENT PIH PUBLIC SPENDING COMMODITY PRICES MACROECONOMIC PERFORMANCE WEIGHTS INVESTMENT BOOM EXPORT SHARE WORLD MARKET POLITICAL INSTABILITY EXCHANGE RATE REGIMES FISCAL POSITION POLITICAL RISK ECONOMIES DEBT RELIEF Fiscal indicators for resource-rich and resource-poor low- and middle-income countries are compared using annual data from 1996 to 2012. Resource richness is defined by export composition: fuel greater than a 25 percent share and/or ores and metals greater than a 10 percent share. Fuel exporters have a significantly better general government fiscal balance than the rest of the sample, and higher revenues and expenditures, which are approximately evenly split between extra consumption expenditure and extra capital expenditure. Only about a quarter of their extra revenue goes into extra consumption expenditure, and this proportion has been lower since 2005. Fuel exporters' expenditure reacts with a lag to oil price fluctuations. There are no significant differences between ores and metals exporters and resource-poor countries, or between new and old resource exporters, in aggregate expenditures and revenues. Ores and metals exporters spend more on investment and less on government consumption. Some individual country cases are briefly discussed. 2016-02-03T20:00:35Z 2016-02-03T20:00:35Z 2016-02 Working Paper http://documents.worldbank.org/curated/en/2016/02/25860947/resource-rich-countries-suffer-lack-fiscal-discipline http://hdl.handle.net/10986/23727 English en_US Policy Research Working Paper;No. 7552 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	DEFICIT MONETARY POLICY RISKS UNCERTAINTIES ECONOMIC GROWTH OIL PRICE FISCAL BALANCES RELATIVE PRICE HARD PEG FINANCIAL MANAGEMENT STOCK FOREIGN INVESTORS FISCAL DEFICITS COUNTRY FIXED EFFECTS INTEREST DUMMY VARIABLES SEIGNIORAGE REGIME CLASSIFICATION EXCHANGE GOVERNMENT REVENUES MACROECONOMIC POLICY DEVELOPING COUNTRIES CURRENCY UNION EXPORTERS PEG DUMMY REVENUES POSITIVE COEFFICIENT INFLATION TARGETING FISCAL POLICY HIGH INFLATION PEGS TAX DUMMY VARIABLE HARD PEGS INFLATION INTERNATIONAL BANK POLITICAL RISKS BUDGET GOVERNMENT SAVING AMOUNT OF CAPITAL STANDARD DEVIATION OIL PRICES CURRENCY PRICE DYNAMICS PRICE VOLATILITY SURPLUS GLOBALIZATION MONETARY FUND DEBT MARKETS SEIGNIORAGE REVENUE RETURN DEFICITS INTERNATIONAL DEVELOPMENT CONSUMPTION EXPENDITURE BUDGET DEFICIT EXPENDITURE INCREASE RESERVES NATURAL RESOURCES GROSS DOMESTIC PRODUCT SERIAL CORRELATION FINANCE PEG PUBLIC INVESTMENT TAXES FISCAL DEFICIT INVESTMENT DECISIONS EXPENDITURE EXCHANGE-RATE INVESTORS CONSUMPTION SURPLUSES GOOD TOTAL EXPORTS COUNTRY RISK SLOW GROWTH BUDGET SURPLUS FUTURE HARD PEG DUMMY LEGAL TENDER EXPROPRIATION RISK DEPENDENT VARIABLE RETURNS PRICE OF OIL FOREIGN INVESTMENT DEMAND GOVERNMENT EXPENDITURE EXPORT SHARES INVESTMENT PROJECTS DEPENDENT VARIABLES PRICE CHANGES GOVERNMENT REVENUE EXPENDITURES PRICE FLUCTUATIONS PROPERTIES ZERO WEIGHT SHARES ASSETS MARKET INVESTMENT CHOICES PRICE INCREASE PUBLIC DEBT EXPORTER REGRESSION ANALYSIS FIXED EFFECTS PERMANENT INCOME HYPOTHESIS EXPROPRIATION GOVERNMENT POLICIES WEIGHT BILL CONSUMPTION SMOOTHING GOODS INVESTOR CURRENCY BOARD INVESTMENT NATURAL RESOURCE RISK RANDOM WALK SHARE FINANCIAL MARKETS SUPPLY POLITICAL STABILITY FISCAL BALANCE UNCERTAINTY REVENUE INVESTMENTS COMMODITY MARKET RAPID GROWTH EXCHANGE RATE FISCAL DISCIPLINE GOVERNMENT INVESTMENT PIH PUBLIC SPENDING COMMODITY PRICES MACROECONOMIC PERFORMANCE WEIGHTS INVESTMENT BOOM EXPORT SHARE WORLD MARKET POLITICAL INSTABILITY EXCHANGE RATE REGIMES FISCAL POSITION POLITICAL RISK ECONOMIES DEBT RELIEF
spellingShingle	DEFICIT MONETARY POLICY RISKS UNCERTAINTIES ECONOMIC GROWTH OIL PRICE FISCAL BALANCES RELATIVE PRICE HARD PEG FINANCIAL MANAGEMENT STOCK FOREIGN INVESTORS FISCAL DEFICITS COUNTRY FIXED EFFECTS INTEREST DUMMY VARIABLES SEIGNIORAGE REGIME CLASSIFICATION EXCHANGE GOVERNMENT REVENUES MACROECONOMIC POLICY DEVELOPING COUNTRIES CURRENCY UNION EXPORTERS PEG DUMMY REVENUES POSITIVE COEFFICIENT INFLATION TARGETING FISCAL POLICY HIGH INFLATION PEGS TAX DUMMY VARIABLE HARD PEGS INFLATION INTERNATIONAL BANK POLITICAL RISKS BUDGET GOVERNMENT SAVING AMOUNT OF CAPITAL STANDARD DEVIATION OIL PRICES CURRENCY PRICE DYNAMICS PRICE VOLATILITY SURPLUS GLOBALIZATION MONETARY FUND DEBT MARKETS SEIGNIORAGE REVENUE RETURN DEFICITS INTERNATIONAL DEVELOPMENT CONSUMPTION EXPENDITURE BUDGET DEFICIT EXPENDITURE INCREASE RESERVES NATURAL RESOURCES GROSS DOMESTIC PRODUCT SERIAL CORRELATION FINANCE PEG PUBLIC INVESTMENT TAXES FISCAL DEFICIT INVESTMENT DECISIONS EXPENDITURE EXCHANGE-RATE INVESTORS CONSUMPTION SURPLUSES GOOD TOTAL EXPORTS COUNTRY RISK SLOW GROWTH BUDGET SURPLUS FUTURE HARD PEG DUMMY LEGAL TENDER EXPROPRIATION RISK DEPENDENT VARIABLE RETURNS PRICE OF OIL FOREIGN INVESTMENT DEMAND GOVERNMENT EXPENDITURE EXPORT SHARES INVESTMENT PROJECTS DEPENDENT VARIABLES PRICE CHANGES GOVERNMENT REVENUE EXPENDITURES PRICE FLUCTUATIONS PROPERTIES ZERO WEIGHT SHARES ASSETS MARKET INVESTMENT CHOICES PRICE INCREASE PUBLIC DEBT EXPORTER REGRESSION ANALYSIS FIXED EFFECTS PERMANENT INCOME HYPOTHESIS EXPROPRIATION GOVERNMENT POLICIES WEIGHT BILL CONSUMPTION SMOOTHING GOODS INVESTOR CURRENCY BOARD INVESTMENT NATURAL RESOURCE RISK RANDOM WALK SHARE FINANCIAL MARKETS SUPPLY POLITICAL STABILITY FISCAL BALANCE UNCERTAINTY REVENUE INVESTMENTS COMMODITY MARKET RAPID GROWTH EXCHANGE RATE FISCAL DISCIPLINE GOVERNMENT INVESTMENT PIH PUBLIC SPENDING COMMODITY PRICES MACROECONOMIC PERFORMANCE WEIGHTS INVESTMENT BOOM EXPORT SHARE WORLD MARKET POLITICAL INSTABILITY EXCHANGE RATE REGIMES FISCAL POSITION POLITICAL RISK ECONOMIES DEBT RELIEF Bleaney, Michael Halland, Havard Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
relation	Policy Research Working Paper;No. 7552
description	Fiscal indicators for resource-rich and resource-poor low- and middle-income countries are compared using annual data from 1996 to 2012. Resource richness is defined by export composition: fuel greater than a 25 percent share and/or ores and metals greater than a 10 percent share. Fuel exporters have a significantly better general government fiscal balance than the rest of the sample, and higher revenues and expenditures, which are approximately evenly split between extra consumption expenditure and extra capital expenditure. Only about a quarter of their extra revenue goes into extra consumption expenditure, and this proportion has been lower since 2005. Fuel exporters' expenditure reacts with a lag to oil price fluctuations. There are no significant differences between ores and metals exporters and resource-poor countries, or between new and old resource exporters, in aggregate expenditures and revenues. Ores and metals exporters spend more on investment and less on government consumption. Some individual country cases are briefly discussed.
format	Working Paper
author	Bleaney, Michael Halland, Havard
author_facet	Bleaney, Michael Halland, Havard
author_sort	Bleaney, Michael
title	Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
title_short	Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
title_full	Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
title_fullStr	Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
title_full_unstemmed	Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?
title_sort	do resource-rich countries suffer from a lack of fiscal discipline?
publisher	World Bank, Washington, DC
publishDate	2016
url	http://documents.worldbank.org/curated/en/2016/02/25860947/resource-rich-countries-suffer-lack-fiscal-discipline http://hdl.handle.net/10986/23727
_version_	1764454646760341504

Do Resource-Rich Countries Suffer from a Lack of Fiscal Discipline?

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