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NATIONAL BUREAU OF ECONOMIC RESEARCH
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Enrique Alberola

Bank for International Settlements (BIS)
Basel, Switzerland

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Institutional Affiliation: Bank for International Settlements (BIS)

NBER Working Papers and Publications

February 2017Revisiting the Commodity Curse: A Financial Perspective
with Gianluca Benigno: w23169
We study the response of a three-sector commodity-exporter small open economy to a commodity price boom. When the economy has access to international borrowing and lending, a temporary commodity price boom brings about the standard wealth effect that stimulates demand and has long-run implications on the sectoral allocation of labour. If dynamic productivity gains are concentrated in the traded goods sector, the commodity boom crowds out the traded sector and delays convergence to the world technology frontier. Financial openness by stimulating current demand, amplifies the crowding out effect and may even lead to a growth trap, in which no resources are allocated to the traded sector. From a normative point of view, our analysis suggests that capital account management policies could be w...

Published: Alberola, Enrique & Benigno, Gianluca, 2017. "Revisiting the commodity curse: A financial perspective," Journal of International Economics, Elsevier, vol. 108(S1), pages 87-106. citation courtesy of

July 2016Revisiting the Commodity Curse: A Financial Perspective
with Gianluca Benigno
in NBER International Seminar on Macroeconomics 2016, Richard Clarida, Lucrezia Reichlin, and Michael Devereux, organizers
 
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