A Systematic Review of the Effects and Symptoms of the Dutch Disease Globally : Lessons for Guyana

The Dutch Disease is a well-documented phenomenon observed in countries that have experienced a boom in a non-renewable resource such as oil and gas and minerals. The literature on the Dutch Disease dates back to the 1980s and there is empirical evidence on the economic effects on countries all over the globe. The evidence documented from the numerous studies done on Dutch Disease can therefore be used as a guide for policy makers to equip countries in lieu of a resource boom. This paper synthesizes the literature on Dutch Disease to outline the key economic effects documented in the literature. The main thematic areas of economic effects from the countries identified in the literature synthesis was then analyzed using trend analysis from a time series of economic variables for each country to represent the respective thematic areas. The trends were then discussed against the theoretical literature on Dutch Disease. The trend analysis was then extended to the country of Guyana which is on the verge of an oil boom primarily to identify if the synthesis can provide any possible indications of potential Dutch Disease effects for the country. The synthesis showed impacts to manufacturing which had a cyclical trend and agriculture which had a downward trend in the contribution of agriculture to Gross Domestic Product (GDP). The synthesis also showed sporadic economic growth and varying effects on the exchange rate and wages in the country. The data for Guyana shows a pre-disposition for Dutch Disease effects with the incoming oil boom and the potential existence of the Dutch Disease already stemming from the country’s mining sector