Do Oil Windfalls Improve Living Standards? Evidence from Brazil

  title={Do Oil Windfalls Improve Living Standards? Evidence from Brazil},
  author={Francesco Caselli and Guy Michaels},
  journal={NBER Working Paper Series},
We use variation in oil output among Brazilian municipalities to investigate the effects of resource windfalls. We find muted effects of oil through market channels: offshore oil has no effect on municipal non-oil GDP or its composition, while onshore oil has only modest effects on non-oil GDP composition. However, oil abundance causes municipal revenues and reported spending on a range of budgetary items to increase, mainly as a result of royalties paid by Petrobras. Nevertheless, survey-based… 
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