Dutch disease causes an appreciation of the national currency value
the verdict
SUPPORTED
the evidence backs this
confidence 88/100
Economic literature and empirical studies consistently show that the Dutch disease phenomenon—driven by resource windfalls or foreign exchange inflows—leads to an appreciation of the real exchange rate.
Evidence for · 7
When and Why Worry About Real Exchange Rate Appreciation? The Missing Link Between Dutch Disease and Growth
2013 · cited by 132
Documents that resource booms and foreign exchange inflows trigger real exchange rate appreciation.
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More for · 6
Boom Goes the Price: Giant Resource Discoveries and Real Exchange Rate Appreciation
2020 · cited by 52
Estimates that giant oil and gas discoveries appreciate bilateral real exchange rates significantly.
Oil boom, exchange rate and sectoral output: An empirical analysis of Dutch disease in oil-rich countries
2021 · cited by 32
Shows empirical evidence across multiple oil-rich countries that oil booms cause real exchange rate appreciation.
When and Why Worry About Real Exchange Rate Appreciation? The Missing Link Between Dutch Disease and Growth
2010 · cited by 24
Confirms that resource booms and foreign exchange inflows lead to real exchange rate appreciation.
The Dutch disease revisited: consistency of theory and evidence
2023 · cited by 15
Finds that resource booms result in real exchange rate appreciation via the spending channel.
Oil-Price Boom and Real Exchange Rate Appreciation
2011 · cited by 4
Notes that oil-rich countries experiencing booms also face relatively large real exchange rate appreciations.
China trade shock: Is there a reversal of Dutch disease for exporters of primary commodities?
2025 · cited by 3
Observes that commodity booms can cause exchange rate appreciation affecting specific industries.