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Nigerian Oil and Exchange Rates: Indicators of ‘Dutch Disease’

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  • John J. Struthers

Abstract

This article assesses the impact of expanding oil revenues on non‐oil sectors of the Nigerian economy from 1960 to 1985/6. Emphasis is placed on the effects of exchange rate appreciation during the 1970s on the agricultural, manufacturing and non‐traded goods sectors. The analysis is conducted within a Dutch disease context. Two main conclusions are that the decline of Nigerian agriculture during these years can be attributed to a combination of low real producer prices and insufficient government investment, as well as the overvalued Nigerian naira; and that the high real exchange rate may have benefited the manufacturing sector.

Suggested Citation

  • John J. Struthers, 1990. "Nigerian Oil and Exchange Rates: Indicators of ‘Dutch Disease’," Development and Change, International Institute of Social Studies, vol. 21(2), pages 309-341, April.
    • Handle: RePEc:bla:devchg:v:21:y:1990:i:2:p:309-341
    DOI: 10.1111/j.1467-7660.1990.tb00379.x
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    References listed on IDEAS

    as
    1. de Macedo, Jorge Braga, 1982. "Currency diversification and export competitiveness : A model of the Dutch disease in Egypt," Journal of Development Economics, Elsevier, vol. 11(3), pages 287-306, December.
    2. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-380, November.
    3. Gregory, R.G., 1976. "Some Implications Of The Growth Of The Mineral Sector," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 20(2), pages 1-21, August.
    4. W. M. Corden, 1982. "Exchange Rate Policy and the Resources Boom," The Economic Record, The Economic Society of Australia, vol. 58(1), pages 18-31, March.
    5. Edwards, Sebastian & Aoki, Masanao, 1983. "Oil export boom and Dutch-disease : A dynamic analysis," Resources and Energy, Elsevier, vol. 5(3), pages 219-242, September.
    6. van Wijnbergen, Sweder J G, 1984. "The 'Dutch Disease': A Disease after All?," Economic Journal, Royal Economic Society, vol. 94(373), pages 41-55, March.
    7. Harberger, Arnold C., 1983. "Dutch disease -- how much sickness, how much boon?," Resources and Energy, Elsevier, vol. 5(1), pages 1-20, March.
    8. P J Forsyth & J A Kay, 1980. "The economic implications of North Sea Oil Revenues," Fiscal Studies, Institute for Fiscal Studies, vol. 1(3), pages 1-28, July.
    9. repec:bla:ecorec:v:58:y:1982:i:160:p:18-31 is not listed on IDEAS
    10. Pinto, Brian, 1987. "Nigeria during and after the Oil Boom: A Policy Comparison with Indonesia," The World Bank Economic Review, World Bank, vol. 1(3), pages 419-445, May.
    11. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-848, December.
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    Cited by:

    1. Goldman, Abe & Smith, Joyotee, 1995. "Agricultural transformations in India and Northern Nigeria: Exploring the nature of Green Revolutions," World Development, Elsevier, vol. 23(2), pages 243-263, February.
    2. Olanubi, Sijuola Orioye, 2023. "Foreign exchange intervention and the Dutch disease under incomplete information," The Journal of Economic Asymmetries, Elsevier, vol. 28(C).
    3. James Fenske & Igor Zurimendi, 2017. "Oil and ethnic inequality in Nigeria," Journal of Economic Growth, Springer, vol. 22(4), pages 397-420, December.
    4. Davis, Graham A., 1995. "Learning to love the Dutch disease: Evidence from the mineral economies," World Development, Elsevier, vol. 23(10), pages 1765-1779, October.
    5. Hampton, Mark P. & Christensen, John, 2002. "Offshore Pariahs? Small Island Economies, Tax Havens, and the Re-configuration of Global Finance," World Development, Elsevier, vol. 30(9), pages 1657-1673, September.
    6. Yazdanpanah, Ahmad, 1994. "The impact of oil price on food security in the Algeria, Iran, and Saudi Arabia: cointegration, vector-error correction model, dynamics, and causality analysis," ISU General Staff Papers 1994010108000011661, Iowa State University, Department of Economics.

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