Socio-Economic Planning in an Era of Falling Oil Revenues: The Case of Venezuela

Abstract

In August 1983, the Caribbean Basin Economic Recovery Act was signed into law by President Reagan. The purpose of the Act was to liberalize trade, to promote local investment, and to increase supplemental aid to developing countries. In this paper a model of one of the beneficiary countries (Jamaica) is built and growth rates of selected macroeconomic variables are estimated through 1990. The potential for positive economic growth in Jamaica is assessed. We conclude that an optimal program for Jamaica seems to be one of moderate growth in central bank credit combined with a small increase in exports.