Abstract
This analysis empirically investigates long-term impact of oil boom on the dynamics of economic growth in Azerbaijan for the post-Soviet period. Although that, oil boom allowed the government maintain macroeconomic stability and positive GDP growth in cases of falls of hydrocarbon production, through having access to large-scale revenues from oil export and creating strategic reserves, the results demonstrate that, in the long run, it has fallen short in terms of building the basis for sustainable development and led to adverse changes in structure of GDP growth. Additionally, utilizing oil revenues as the main financial source for development carries greater risk of a decline in GDP growth under scenarios of sharp decline in oil prices. Therefore, in order to ensure sustainable stability in economic growth patterns, creation of strategic reserves must be accompanied with expansion of potential of non-oil sector export within policy of diversification the economy and with the establishment of advanced financial and banking system.

Keywords
Azerbaijan, oil boom, GDP growth, long-term growth factors, the structure of growth, oil prices

Cite this paper
Professor Hamza Khalilov, Long-term impact of oil-boom on economic growth dynamics: Evidence from Azerbaijan , SCIREA Journal of Economics. Volume 3, Issue 1, February 2018 | PP. 1-18.

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