Journal of Hotel and Business Management
Open Access

Abstract

Dutch Disease: Rent Seeking Behavior in Oil Exporting Countries-How Contagious is it?

Caroline Mahmood Khan*

This study examined the effects of Dutch disease on the economic growth of fourteen oil-exporting nations over 39 years. Employing a quantitative research design, the study utilized the Generalized Method of Moments (GMM) dynamic panel approach and a classification tree method to categorize the countries based on their oil production levels and reassess the relationship between oil and Per-capita Gross Domestic Product (Per-capita GDP). The dataset, sourced from the World Bank, comprises annual observations from 14 countries spanning the period from 1980 to 2014. The results revealed no significant evidence of an oil resource curse and no significant impact of oil renting on economic growth. The results further revealed that literacy rate and per-capita income in exporting countries were not affected by oil reserves. Traditional random and fixed effects estimators were employed in the panel data analysis to underscore the advantages of the difference GMM approach. The study recommends the oil market be made aware of the baseless theories related to oil renting, which hinder the growth of business startups and oil trading.

Published Date: 2024-12-04; Received Date: 2024-11-04