Economic Diversification and Policy in Azerbaijan

Year 2015, Volume: 1 Issue: 1, 39 - 59, 01.06.2015

Sedat Aybar Matanat Rasulova Faiq Qasimli Dutch Disease

Abstract

The purpose of this paper is to develop an analysis of economic diversification of Azerbaijan and suggest some policy options for further diversification. More specifically, this paper aims to assess export diversification in Azerbaijan by analyzing diversification performances of two petroleum exporting countries namely Indonesia and Nigeria. The paper first discusses the merits of diversification by referring to existing literature on this topic then moves onto present an analyses of current economic situation and export potential of Azerbaijan. The paper also presents an econometric model in which measurement of diversification is proposed. Calculating diversification based on a model proceeded by using standard macro-economic ratios appears to develop our understanding of the level of diversification of the economy of Azerbaijan. In the final section concluding remarks and policy suggestions to achieve a more diversified economy is presented

Keywords

Economy of Azerbaijan, Petroleum Exporting Countries

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