Calculating Sustainable Non-mineral Balances as Benchmarks for Fiscal Policy: The Case of Botswana

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Author/Editor: Jens R. Clausen
Release Date: © May, 2008
ISBN : 978-1-45186-977-4
Stock #: WPIEA2008117
English
Stock Status: Available

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Description

Assuming a social welfare function that smoothes expenditure, this paper calculates a sustainability benchmark for the non-mineral balance in Botswana that is based on a notion of a "permanent income" from non-renewable resources. It is derived by constructing a hypothetical annuity from revenues from these resources, which is held constant in terms of GDP. Botswana is an interesting case because current projections suggest that diamond resources could be largely exhausted within a generation.

Taxonomy

Economic policy , Fiscal policy




More publications in this series: Working Papers


More publications by: Jens R. Clausen