Is Chad affected by Dutch or Nigerian disease?

Sandrine Kablan (1) , Josef Loening (2)

1 ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique
2 The World Bank - The World Bank

We examine the effects of the ‘natural resource curse’ on Chad and find little evidence for Dutch disease. Structural vector auto-regression suggests that changes in domestic output and prices are overwhelmingly determined by aggregate demand and supply shocks, and while oil production and high international prices negatively affect agricultural output, the effects are small. Consistent with empirical evidence for neighbouring Cameroon, we observe minimal impact on Chad’s manufacturing sector. We associate our findings with structural underemployment and the inefficient use of existing production factors. In this context, increased public expenditures in tradable sectors present the opportunity to make oil revenues an engine of national development.

Domaines: Économie et finance quantitative [q-fin]

Sandrine Kablan, Josef Loening. Is Chad affected by Dutch or Nigerian disease?. 2017. ⟨hal-01527664⟩