Non-Renewable Resources, Fiscal Rules, and Human Capital

Levine, Paul ; Melina, Giovanni ; Onder, Harun

World Bank, Washington, DC

关键词: GOVERNMENT SAVINGS;    WITHDRAWAL;    CAPITAL MARKETS;    HOLDING;    EXTERNAL COMMERCIAL BORROWING;   

DOI  :  10.1596/1813-9450-7695
RP-ID  :  WPS7695

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper develops a multi-sector,small open economy Dynamic Stochastic General Equilibriummodel, which includes the accumulation of human capital,built via public expenditures in education and health. Fourpossible fiscal rules are examined for total publicinvestment in infrastructure, education, and health in thecontext of a sustainable resource fund: the spend-as-you-go,bird-in-hand spending; moderate front-loading, and permanentincome hypothesis approaches. There are two dimensions tothis exercise: the scaling effect, which describes the levelof total investment, and the composition effect, whichdefines the structure of investment between infrastructure,education, and health. The model is applied to Kenya. Forimpacts on the non-resource economy, efficiency of spending,and sustainability of fiscal outcomes, the analysis findsthat, although investment frontloading would bring highgrowth in the short term, the permanent income hypothesisapproach is overall more desirable when fiscalsustainability concerns are taken into consideration.Finally, a balanced composition is the preferred structureof investment, given the permanent income hypothesisallocation of total investment over time.