02508cas a2200277 a 4500 AALejournalIMF013628 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484321379 1018-5941 BD-DhAAL BD-DhAAL Basu, Suman. The Macroeconomic Effects of Natural Resource Extraction : Applications to Papua New Guinea / Suman Basu, Jan Gottschalk, Werner Schule, Nikhil Vellodi. Washington, D.C. : International Monetary Fund, 2013. 1 online resource (37 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students To investigate the effects on Papua New Guinea's economy of substantial liquified natural gas revenues arriving in 2015, we employ a model to examine the macroeconomic effects of a scalingup of natural resource windfall revenues and the implications for a variety of policy responses. The model is a multi-sector dynamic stochastic general equilibrium (DSGE) model, and features components that allow for a detailed study of the effects of both fiscal and monetary policy in response to a positive shock to the mineral resource value of a country. The model contains tradable, non-tradable, and mining sectors, as well as an independent central bank and fiscal authority. We calibrate the model to the current economy of Papua New Guinea and run a suite of policy simulations. We find that macroeconomic effects from a resource boom typically associated with Dutch Disease effects such as a real appreciation and a fall in tradable sector production stem largely from the non-tradable component of government spending. The central bank can offset the real appreciation, but not without crowding out the private sector. A sovereign wealth fund (SWF), combined with a smooth capital spending path, entails the best means of dealing with macroeconomic volatility and maintaining a stable fiscal regime. Mode of access: Internet Gottschalk, Jan. Schule, Werner. Vellodi, Nikhil. IMF Working Papers; Working Paper ; No. 2013/138 Full text available on IMF http://elibrary.imf.org/view/journals/001/2013/138/001.2013.issue-138-en.xml IMF e-Library