Dutch Disease Economics A case Study of Indonesia
The term ‘Dutch disease’ was first used to describe the indirect effects of the boom in the gas sector<br />in the Netherlands in the 1960s on other sectors. This paper applies this framework to analyse<br />the impact of the 2007-2008 surge in oil and gas prices in Indonesia. It finds t...
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| Format: | Article |
| Language: | English |
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Universitas Islam Indonesia
2011-09-01
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| Series: | Economic Journal of Emerging Markets |
| Online Access: | http://jurnal.uii.ac.id/index.php/JEP/article/view/2287 |
| Summary: | The term ‘Dutch disease’ was first used to describe the indirect effects of the boom in the gas sector<br />in the Netherlands in the 1960s on other sectors. This paper applies this framework to analyse<br />the impact of the 2007-2008 surge in oil and gas prices in Indonesia. It finds that this has induced a<br />real appreciation of the Rupiah. In contrast to ‘Dutch disease’ theory, it has been accompanied by<br />growth in agricultural and manufacturing exports. The simulation results suggest that the observed<br />real appreciation due to the booming energy has inhibited the growth of Indonesian exports of agricultural<br />and manufacturing products.<br />Keywords: Dutch disease, energy, agricultural and manufacturing exports |
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| ISSN: | 2086-3128 2502-180X |