CC BY
8
УДК 33:338
Akimova V.I. master degree student 1st course
Faculty of International Finance The Financial University under the Government of the Russian
Federation Russia, Moscow
THE DUTCH DISEASE IN ANGOLA AND HOW IT INFLUENCES GDP.
Annotation. The work is dedicated to the analyses of the economic model within 25-years period in Angola. The analyses was made with the help of econometrics program Eviews. The obtained results helps to understand how GDP depends on export of oil, M2, exchange relation, inflow offoreign direct investments and inflation. Despite the fact that not all tests have been passed in Eviews, the resulting model can be used for further research of Dutch disease in Angola.
Key words: GDP, "Dutch Disease ", the role of Angola oil market, export of oil, M2, exchange relation, inflow of foreign direct investments, inflation.
Акимова В.И. студент магистратуры 1 курс, факультет «Международный финансовый» Финансовый Университет при Правительстве РФ
Россия, г. Москва ГОЛЛАНДСКАЯ БОЛЕЗНЬ В АНГОЛЕ И ЕЕ ВЛИЯНИЕ НА ВВП
Аннотация. Статья посвящена анализу экономической модели в Анголе в течение 25-летнего периода. Анализы были сделаны с помощью эконометрической программы Eviews. Полученные результаты помогли понять, как ВВП зависит от экспорта нефти, М2, обменного курса, притока прямых иностранных инвестиций и инфляции. Несмотря на то, что не все контрольные тесты в Eviews были пройдены, полученная модель может быть использована для дальнейших исследований «Голландской болезни» в Анголе.
Ключевые слова: ВВП, «Голландская болезнь», место Анголы на рынке нефти, денежная масса, обменный курс, поток прямых инвестиций, инфляция.
Until the 1980s it was believed that the abundance of natural resources makes enable for developing countries to overcome successfully the transitional period and achieve the industrial "take-off" in the same way with Australia and the USA. Nowadays, many economists have the opposite point of view and think about Dutch disease named "Groningen effect".
Dutch disease represents the negative effect of influence a strengthening real exchange rate of national currency on economic development because of the boom in a separate sector of the economy. Theoretically, the reason for the boom is not
significant, but in practice, the effect is usually connected with a natural resource discovery.
The inflow of oil revenues has a negative effect on the industry. Foreign currency earnings from the export of oil leads to a strengthening of the national currency. As a result, other export production becomes uncompetitive and effect a massive outflow of labor and capital resources in the extractive sector is observed. The country becomes dependent on imports and agriculture and traditional industries are destroyed.
A classic example of the country suffered from Dutch Disease is Angola, a country in Southern Africa. The oil boom has led to a tendency for real exchangerate appreciation that has contributed to reducing the competitiveness of the non-resource and tradable sectors, predominantly agriculture and manufacturing. Undoubtedly, it also has been massively enhanced by 35 years of civil war in which production has been handicapped by displacement, destruction of infrastructure, instability, banditry, and landmines. To this challenging and complex business environment, should be added Angola's legacy of centuries of bureaucratic colonization and central planning.
Moreover, Angola has negative effect from Dutch disease in social sector. From Michael Ross's point of view (University of California at Los Angeles) oil countries fare worse on child mortality and nutrition, have lower literacy and school-enrolment rates and do relatively worse on measures like the UN's "Human Development Index". To my mind, its can be connected with the following fact: unlike agriculture, the oil sector of Angola employs few unskilled people. The inherent volatility of commodity prices hurts the poor the most, as they are least able to hedge their risks. And because the resource is concentrated, the resulting wealth passes through only a few hands—and so is more susceptible to misdirection.
In order to estimate how big Dutch Disease symptoms are, the economic model describing GDP effected export of oil, M2, exchange relation, inflow of foreign direct investments, inflation was analyzed. There are two endogenous variables, such as GDP and export of oil (EXPOIL), and four exogenous - M2, exchange relation (EX), inflow of foreign direct investments (INV), inflation (INFL). In the result, the following model was made:
GDP = C(1) + C(2)*EXPOIL + C(3)*M2 + C(4)*EX EXPOIL = C(5) + C(6)*GDP + C(7)*INV + C(8)*INFL After calculations, using the econometrics program Eviews, the following results were obtained:
Equation: GDP = C(1) + C(2)*EXPOIL + C(3)*M2 + C(4)*EX Instruments: EX INV INFL С Observations: 21
R-squared Adjusted R-squared S.E. of regression Durbin-Watson stat
0.974446 0.969937 4812.600 0.825319
Mean dependent var S.D. dependent var Sum squared resid
57892.06 27756.41 3.94E+08
Equation: EXPOIL = C(5) + C(6)*GDP + C(7)*INV + C(8)*INFL Instruments: EX INV INFL С Observations: 21
R-squared Adjusted R-squared S.E. of regression Durbin-Watson stat
0.955018 0.947079 6251.625 1.919526
Mean dependent var S.D. dependent var Sum squared resid
31042.86 27175.71 6.64 E+08
In accordance with the results, we can conclude that 97% of total GDP is explained by the fluctuations of exogenous variables (M2, exchange relation, inflow of foreign direct investments, inflation). Such a high coefficient of determination (R-squared =0,97 and R-squared =0,95) tells us about adequate econometric model. It indicates a significant degree of dependence of the resulting values from the factors. The model can be interpreted in the following way: a change in the export of oil rate by 1% will result to the change in the value of GDP (0.33 USD Billion).
After made analysis, the further strengthening of the role of Angola oil market can be expected. One of the factors is that oil is the main USA interests in Africa. Within five years, the USA plan is to increase the continent's share in the total volume of oil imports to 25% compared with 15% at the moment.
Nevertheless, as oil revenues shrink, Angola has made steps in recent years to change its economic future. Due to received investment from the United Kingdom, Brazil and the United States, and Angolan President Jose Eduardo dos Santos has pushed business reforms and economic diversification to wean the petro state off crude dependency.
Despite government efforts to increase economic diversification through an increased focus on the mining, agricultural, and construction sectors, Angola's economy is still heavily dependent on oil exports for foreign currency earnings. The oil sector contributes significantly to GDP and takes a great part in the government revenue. In the result, the following conclusion can be made: obtained econometric model describes economic situation in Angola and can be useful for analyses how export of oil, M2, exchange relation, inflow of foreign direct investments, inflation contribute to Angolas GDP and cause Dutch disease.
References
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2. Трегуб И.В. Анализ модели инфляции с применением эконометрических и имитационных методов // сборник трудов научно-практической конференции «эконометрические методы в исследовании глобальных экономических процессов», 29 октября 2013 г. Москва, МГИМО (у) МИД России, фонд развития МГИМО. М.: АНКИЛ, 2013. С.223-232
3.Economist, 2005. The Paradox of Plenty, 97-99
4.Ricardo Dias, 2015. Angolan imports fell 25 percent in the second quarter of 2015. Global Agricultural information network 22 (13), 146-147
5. Tregub I.V. Econometrics. Model of real system - монография, М.: 2016. 166 р.
УДК 336.642
Besperstov V. master student International Finance Faculty Financial University under the Government of the Russian Federation
Russia, Moscow Scientific Supervisor: I. V. Tregub REAL ESTATE VALUATION USING SALES COMPARISON METHOD AND MULTIPLE REGRESSION ANALYSIS ON THE EXAMPLE OF RUSSIA
Abstract: Valuation method using multiple regression analysis is widely used across the globe and is seldom used in Russia. The aim of present study is to find the advantages and disadvantages of using Multiple Regression Analysis (MRA) in valuation compared to the application of traditional approach of sales comparison. The procedure of application of MRA involves identifying and listing the factors that influence the value of a house. It is done through literature review of previous researches, published articles, questionnaire survey and interviews of experts in the field. From these attributes, critical house value influencing factors are chosen after thorough statistical analysis of questionnaire survey. In total, samples of fifty three valuation reports have been used & regression has been carried out. The advantage of using MRA method is that it can model the relationship between sale price of a house and housing attributes. MRA regresses each attribute to show how change in each attribute affects the house price. Results obtained from sales comparison method & multiple regression analysis show that, regression gives better accuracy & efficiency in predicting value of property as compared with the traditional approach.
Keywords: Real Estate, property valuation, sales comparison method, multiple regression analysis.
I. Introduction
Real property valuation is a topic of interest for stakeholders for various purposes. Investors are interested to know the purchase price of the property in which they are going to invest. Developers seek to find out the feasibility of selling price for their decision-making. There are risks and uncertainties in property
