External Shocks and Labor Market Reforms in Autocracies and Democracies: Evidence from Oil Price Windfalls

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• In this appendix we discuss the estimated effects of oil price windfalls on the 2
• We start by examining the response of oil rents Figure A1. As expected rents 2
• The effect gradually decreases over the horizon considered to stabilize at about 0.4 2
• Next we turn to the response of the current account balance Figure A2 GDP 2
• Figure A3 and the employment rate Figure A4. Positive oil price windfalls tend to 2
• However the effects that we estimate for the current account balance are only statistically 2
• 0.5 percentage points employment rate 4 years after a 1-standard-deviation positive 2
• Oil price windfall losses in autocracies have some negative although relatively 3
• GDP but have important negative effects on the current account balance. This decreases 3
• 99 confidence level and never recovers over the 5-year horizon that we consider. The 3
• Tax revenues respond broadly as expected Figure A6. Their impact response to 3
• These responses may be largely mechanical if oil rents were subject to a higher tax rate 3
• Turning to government expenditures Figure A7 their impact response to positive 3
• We close the analysis by considering the response of the budget balance Figure A8. 4
• This increases following positive windfalls in both autocracies and democracies but this 4
• Table A1 Country Coverage 5
• Autocracies Democracies Switchers 5
• Azerbaijan Australia India Albania Mozambique 5
• China Peoples 5
• Republic of 5
• Austria Ireland Argentina Nigeria 5
• Cameroon Belgium Israel Burkina Faso Nicaragua 5
• Jordan Bulgaria Italy Bangladesh Nepal 5
• Kazakhstan Canada Jamaica Belarus Pakistan 5
• Morocco Switzerland Japan Bolivia Peru 5
• Singapore Colombia Sri Lanka Brazil Philippines 5
• Tanzania Costa Rica Lithuania Chile Poland 5
• Uzbekistan Czech 5
• Republic 5
• Latvia Dominican Republic 5
• Portugal 5
• Viet Nam Germany Malaysia Algeria Paraguay 5
• Denmark Netherlands Ecuador Romania 5
• Estonia Norway Spain Senegal 5
• Finland New Zealand Ethiopia El Salvador 5
• France Sweden Ghana Thailand 5
• United 5
• Kingdom 5
• Ukraine Greece Tunisia 5
• Georgia United States Guatemala Türkiye 5
• Hungary South Africa Indonesia Uganda 5
• Kenya Uruguay 5
• Madagascar Zimbabwe 5
• Mexico 5
• Figure A1 Effects of Oil Price Windfalls on Oil Rents 6
• Figure A2 Effects of Oil Price Windfalls on the Current Account Balance 7
• Figure A3 Effects of Oil Price Windfalls on GDP 8
• Figure A4 Effects of Oil Price Windfalls on the Employment Rate 9
• Figure A5 Effects of Oil Price Windfalls on Tax Revenues 10
• Figure A6 Effects of Oil Price Windfalls on Government Expenditures 11
• Figure A7 Effects of Oil Price Windfalls on the Primary Balance 12