Oil Windfalls Boost Household Gains, Reshape Economic Landscape
The research examines how Indonesia-like economies can use money earned from selling oil. They made a model to see what happens when oil money goes towards public projects, public spending, giving cash to households, or cutting costs on local goods/services. Results showed that if goods are easily available, people benefit without needing subsidies. Giving all oil money to households can even increase their wealth due to exchange rate changes. By analyzing oil pricing and subsidies, the study found ways to manage effects like higher prices and shifts in resources away from non-oil goods. It suggests that subsidies could help balance these effects but might not align with the goal of spending oil money on public needs.