Comparative analysis of oil policies in Venezuela and Azerbaijan

Absztrakt (kivonat)

Purpose The purpose of this research is to explore the reasons standing behind the current crisis in Venezuela and Azerbaijan, identify the similarities in economic environments in both countries, and define the possible common solutions that may be helpful to rescue them from the default. Methodology The main similarities of these two countries were determined by conducting descriptive researches based on existing works. Data collection was carried out by dividing the story line of the topic into 3 main periods. These periods explore precrisis, crisis circles, and after crisis – future perspectives. Furthermore, the post oil crisis policies of Venezuela and Azerbaijan and their relevance is also demonstrated. Findings Findings of this research confirm that overdependence on natural resource extraction can be beneficial in short run in order to develop the financial and economic infrastructure. However, when countries rely on the export of the natural resource too much, they end up with the export crisis when the prices go down, or the demand to that particular resource decreases. Based on the experience of Venezuela and Azerbaijan, it is suggested that countries involved in Dutch syndrome should decrease their dependence on natural resource. Limitations In particular topics it was hard to find reliable data and conducted research. In some particular cases, the information was available only in local news agencies that were pro-government. Implications/Contributions This research can be suggested to the economists who are working on the latest records of “Dutch disease” and its extreme effects on countries, and the ways of fight against it in particular countries.