chapter  1
17 Pages

The malady of prosperity

The present chapter focusses on oil wealth and the macroeconomics of petroleum-exporting countries.The key concept introduced here is the so-called ‘Dutch Disease’ – an effect usually caused by large export earnings from a commodity boom.What that term means, why or under what conditions it operates, and what are the likely consequences for the general production structure of an oil-rich developing country is explained in this chapter.This will prepare the ground for the next chapter, where we shall examine how the macroeconomic impact of oil wealth relates to land use and forests.