International Economic Relations - a complex and multifaceted system, and it is sometimes difficult to determine how certain factors affect its further development.Almost always, a phenomenon that seems at first sight clearly positive, carries some hidden threat to the economy of the country in which they occur.One of these phenomena is the Dutch disease.The fact that the name is hidden behind this problem and how it arises, we will discuss in this article.
Dutch disease - an effect that arises from the fact that in one or more sectors of the economy begins a rapid development, which leads to a serious strengthening of the exchange rate.As a result of these seemingly favorable for the economy of events lead to serious problems.The theoretical sources indicate that it does not matter in what sector started strong growth, but in practice it is known that the Dutch disease most often occurs in the case of the discovery of large deposits of minerals.Yet this phenomenon is called the effect of Groningen - in honor of the countryside in the Netherlands, where more than half a century ago have been discovered huge deposits of natural gas.
consider in more detail the mechanism of the action of which the Dutch disease is harmful to the economy.Due to the fact that minerals (especially when it comes to fuel resources) are the global market is very expensive, the state begins to export these resources to the world market, resulting in a serious beginning the inflow of foreign currency into the country.The increase in foreign reserves leads to the strengthening of both nominal and real exchange rate of the national currency.And from that moment begin to be observed negative effects:
1) due to the appreciation of its currency to the country's import price decreases.Because of this, an increasing number of imported products.At the same time export of any products other than the above-mentioned resources, no longer seems so attractive.As a result, there has been a significant decline in net exports and skewed in its structure;
2) due to the fact that the mining sector now seems more profitable to begin structural changes in the economy - the decline of the manufacturing industry begins.At the same time as a result of income growth service sector can continue to grow for some time, resulting in GDP growth may remain at the same level, so that the negative impact of Dutch disease is masked;
3) inflow of foreign currency causes external to improve life, in particular, increasing the incomes of the population (here plays a role is a political factor - the government in order to secure popularity tries to raise salaries without thinking about the fact that they are not supported by real economic growth).Thus, increases and aggregate demand, which can not be satisfied with the offer available on the market.He begins to spin the flywheel inflation.
Interestingly, in 1955 while still a student and economist Rybchinskiy proved that the sharp rise in some sectors of the economy oppresses others.Thus, Theorem Rybczynski and Dutch disease are inextricably linked: the first is a theoretical model, and the second - its practical realization.
economic history of foreign countries can and should learn.We believe that after reading this article, few people will doubt that the Dutch disease in Russia there is not the first decade, and started back to Soviet times.It is therefore advisable to adopt experience the same Holland and other countries to minimize the consequences of this phenomenon, and we hope that in the future our country will return to the normal structure of the economy.
