Dutch Disease, Resource Curse and Development*

Conclusion and Outlook I
• Windfalls tend to trigger real currency appreciation,
depreciations in slumps
• Avoid inflationary use of the windfalls, cope with volatility
of resource prices
• DD can evolve into an enduring RC if the core sector of
technical progress and growth, manufacturing, is
continuously suppressed
• The terms “disease” and “curse” are a bit misleading, as
wealth increases in booms if not offset in slumps or lost
by inflation or de-industrialization
• Bad “institutions” and “bad governance” are not the
cause of DD and RC, but they exacerbate the problems
• Among developing countries with strong resource
dependence, the only model for more blessing than
curse was Indonesia but it is a special case 40
UNCTAD Division on Technology and Logistics - Knowledge Sharing, Training and Capacity Development Branch