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For over eighty years the Arab region has derived massive wealth from its natural resources, yet the region's economies remain little diversified, while the oil market is experiencing major structural shifts with the advent of shale gas. Moreover, the resource itself is eventually exhaustible. Under these conditions economic prosperity cannot be sustainable. The critical question is how can the countries of this region escape the 'oil curse'? In this volume, leading economists argue that the curse is not a predestined outcome but a result of weak institutions and bad governance. A variety of analytical perspectives and examination of various international case studies leads to the conclusion that natural resources can only spur economic development when combined with sound political institutions and effective economic governance. This volume, with its unique focus on the Arab region, will be an important reference for researchers and policy makers alike.

Natural resources --- Economic development --- Development, Economic --- Economic growth --- Growth, Economic --- Economic policy --- Economics --- Statics and dynamics (Social sciences) --- Development economics --- Resource curse --- National resources --- Resources, Natural --- Resource-based communities --- Economic aspects --- Arab countries --- Economic policy.

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This paper examines whether domestic inflation spikes in Egypt during 2001-2011 were primarily the result of external food price shocks. To estimate the pass-through of international food price inflation to domestic price inflation, two different methodologies are used: a two-step regression model estimates the pass-through in the long run, and a vector autoregression model provides the short-run estimates. The empirical evidence confirms that pass-through is high in the short term, but not in the long run. More precisely, the results show that (i) long-run pass-through to domestic food inflation is relatively low, lying between 13 and 16 percent, while the long-term spill-over from domestic food inflation to core inflation is moderate, lying around 60 percent; (ii) in the short term, pass-through is relatively high, estimated around 29 percent after 6 months and around two-thirds after a year, but the spill-over effect to core inflation is limited; (iii) international food price shocks explain only a small portion of domestic inflation shocks in both the short and long terms; and (iv) international price inflation has asymmetric effects on domestic prices.

Access to Markets --- Currencies and Exchange Rates --- Domestic inflation --- Emerging Markets --- Food & Beverage Industry --- Food pass-through --- Macroeconomics and Economic Growth --- Markets and Market Access --- Poverty Reduction --- VAR --- Egypt

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This work explores the interaction between oil and institutions and examines how Arab countries can best exploit their oil revenues to avoid the resource curse. It offers concrete guidance for policymakers desiring to shield their economies from commodity price volatility and achieve macroeconomic stability and fiscal sustainability.

Macroeconomics. --- Petroleum industry and trade --- Government policy --- Arab countries --- Economic policy. --- Energy industries --- Oil industries --- Economics

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This paper assesses the adequacy and effectiveness of the WAEMU fiscal framework along three pillars that have proven to effectively support fiscal discipline in monetary unions—common fiscal rules (including adequacy of numerical ceilings as well as elements of design and enforcement), shared public financial management systems, and coordination mechanisms for decentralized fiscal policies. We undertake a calibration of regional debt and fiscal deficit ceilings taking into account different macroeconomic tradeoffs and risks and conclude that numerical ceilings that prevailed before the suspension of the fiscal rules remain adequate and strike the right balance between growth and fiscal sustainability. The paper also proposes reform options to strengthen the WAEMU regional fiscal surveillance framework, with a view to more effectively supporting fiscal discipline.

Macroeconomics --- Economics: General --- Public Finance --- Fiscal Policy --- Structure, Scope, and Performance of Government --- National Budget --- Budget Systems --- National Deficit Surplus --- Debt --- Debt Management --- Sovereign Debt --- National Government Expenditures and Related Policies: General --- Economic & financial crises & disasters --- Economics of specific sectors --- Public finance & taxation --- Fiscal rules --- Fiscal policy --- Public financial management (PFM) --- Fiscal governance --- Public debt --- Currency crises --- Informal sector --- Economics --- Finance, Public --- Debts, Public

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The paper analyzes the impact of the recent global crisis in the context of the previous two decades' growth and capital flows. Growth decomposition exercises show that Egyptian growth is driven mostly by capital accumulation. To estimate the share of labor in national income, the analysis adjusts the national accounts statistics to include the compensation of self-employed and non-paid family workers. Still, the share of labor, about 30 percent, is significantly lower than previously estimated. The authors estimate the output costs of the current crisis by comparing the output trajectory that would have prevailed without the crisis with the observed and revised gross domestic product projections for the medium term. The fall in private investment was the main driver of the output cost. Even if private investment recovers its pre-crisis levels, there is a permanent loss in gross domestic product per capita of about 2 percent with respect to the scenario without the crisis. The paper shows how the shock to investment is magnified due to the capital-intensive nature of the Egyptian economy: if the economy had the traditionally-used share of labor in income (40 percent), the output loss would have been reduced by half.

Access to Finance --- Banks & Banking Reform --- Capital accumulation --- Capital outflow --- Debt Markets --- Developing countries --- Economic Theory & Research --- Emerging Markets --- Finance and Financial Sector Development --- GDP --- Global economy --- Gross domestic product --- Gross domestic product per capita --- Investment Capital --- Macroeconomics and Economic Growth --- National income --- Private investment --- Private Sector Development