Does Oil Revenue Crowd Out Other Tax Revenues? : Policy Lessons for Uganda
This paper examines the relationship between hydrocarbon and non-hydrocarbon revenues using a probabilistic panel model with data covering 30 resource-rich countries over 1992-2012. It also discusses policy implications for Uganda, a country with r...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/245571493644820505/Does-oil-revenue-crowd-out-other-tax-revenues-policy-lessons-for-Uganda http://hdl.handle.net/10986/26500 |
| Summary: | This paper examines the relationship
between hydrocarbon and non-hydrocarbon revenues using a
probabilistic panel model with data covering 30
resource-rich countries over 1992-2012. It also discusses
policy implications for Uganda, a country with recently
discovered oil reserves. The findings show that although an
increase in hydrocarbon revenues is likely to crowd out
non-resource revenues, improved institutional quality could
dampen or reverse this effect. In general, regulatory
quality, rule of law, government effectiveness, and
political stability are critically important governance
indicators. In light of Uganda's forthcoming
exploitation of its oil, the odds of avoiding the crowding
out of non-resource revenues are high with a substantial
improvement of institutional quality in terms of political
stability, regulatory quality, and government effectiveness.
Currently, these indicators stand very low for Uganda as
compared with Botswana |
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