Growth In An Oil Abundant Economy: The Case Of Venezuela

Venezuela's growth experience over the past fifty years is characterised by a high economic growth rate from 1950 to 1977 and a low economic growth rate over the 1977-2003 period. In particular, the authors show that the country has been in a 'Great depression' since the late seventies. They also show that although Venezuela has an oil abundant economy, this growth experience is largely due to the evolution of its real non-oil GDP. They perform a growth accounting exercise to quantify the extent to which the growth experience in the non-oil sector is a result of physical capital accumulation, finding that non-oil sector behavior can largely be explained by the evolution of TFP.