preview

Oil and Dutch Disease

Decent Essays

ECONOMICS FOR BUSINESS
Project Report on –
Oil and the recent
‟Dutch Disease‟
- The Case of the United Arab
Emirates
Submitted by –
Amitava Manna
1|Page
Table of Contents
Introduction .................................................................................................................................................. 2
Purpose ......................................................................................................................................................... 3
UAE Background ........................................................................................................................................... 4
Theoretical Framework …show more content…

Purpose
The purpose of this paper is to study U.A.E‟s development in economic growth since 1975 and establish if there are any signs of the Dutch Disease by testing the ratio of tradable goods to non- tradable goods and the effects by other macroeconomic variables.
3|Page
UAE Background
U.A.E consists of the seven emirates Abu Dhabi, Dubai, Sharjah, Ra´s al-Khaimah, Ajman,
Umm al-Qaiwain and Fujairah, which are located on the southern Arabian Gulf. On the 2nd of
December 1971, the country became independent after being under British rule for a period of 70 years. The independence and discovery of oil triggered the economic development in U.A.E which led to a huge expansion in the population. The population boom in U.A.E is a result of the increased demand for labor throughout the past four decades and consists for the most part (83%) of labor from foreign countries referred to as expatriates. United Nation‟s (UN) database illustrates the division of the labor from two perspectives; first from the year 2000 compared to the changes that prevailed in 2010. Female participation and male participation in 2000 consisted of 34.4% in the former group and 92% in the latter group. As stated in the introduction, one of the impacts when an economy is experiencing signs of the Dutch Disease is the high inflation rate followed by a change in the real exchange rate. Fluctuations in the

Get Access