z-logo
Premium
Do natural resource revenues lower government reliance on seigniorage? The role of exchange rate policy
Author(s) -
Ellis Michael A.,
Elbahnasawy Nasr G.
Publication year - 2018
Publication title -
development policy review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.671
H-Index - 61
eISSN - 1467-7679
pISSN - 0950-6764
DOI - 10.1111/dpr.12244
Subject(s) - seigniorage , economic rent , natural resource , economics , revenue , exchange rate , flexibility (engineering) , currency , natural resource economics , resource (disambiguation) , panel data , exchange rate flexibility , monetary economics , exchange rate regime , microeconomics , finance , econometrics , ecology , biology , computer network , management , computer science
The study investigates how the degree of exchange rate management conditions the relationship between seigniorage and governments’ natural resource revenues using a sample of 140 countries over the period from 1971 to 2012. It also disaggregates natural resource revenues to investigate if this relationship holds across the various types of natural resources. The main approach is to estimate dynamic panel data interaction models. The study finds that under exchange rate regimes characterized as fixed or of limited flexibility an increase in natural resource rents is associated with an increase in seigniorage. Under crawling currency bands and managed floating, an increase in natural resource rents has little association with seigniorage. Under exchange rate regimes permitting greater exchange rate flexibility, greater natural resource rents allow less reliance on seigniorage. Additionally, the direct relationship between natural resource rents and seigniorage is driven mostly by oil and natural gas.

This content is not available in your region!

Continue researching here.

Having issues? You can contact us here