Commodity Prices and Growth

In this article, we propose an endogenous growth model of commodity‐rich economies in which: (i) long‐run (steady‐state) growth is endogenous and yet independent of commodity prices; (ii) commodity prices affect short‐run growth through transitional dynamics; and (iii) the status of net commodity importer/exporter is endogenous. We argue that these predictions are consistent with historical evidence from the 19th to the 21st century.