Migrant labor supply in a booming non-renewable resource economy : cure and transmission mechanism for de-industrialization?
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This paper challenges the determinism that booming resource economies suffer from de-industrialization, the “Dutch Disease”. For several decades, economists have attempted to explain how a sudden surge in mineral and energy extraction affects an economy’s output and employment from an aggregate and sectoral perspective. Economic theory shows that a “boom” in mineral and energy production is welfare enhancing to the economy experiencing it. However, the phenomenon also induces inter-sectoral adjustments among non-renewable resource (NRR), traditional traded, and non-traded industries that tend ...