An empirical test of the Dutch Disease hypothesis on Botswana’s main exports

The main objective of the paper was to empirically investigate the possible impact of the DD effects on the economy of Botswana. The study tested the impacts of the diamond resource boom on the country’s manufacturing exports namely, textiles and motor vehicles; mining exports, namely copper and soda ash; and agricultural exports of meat and meat products. The study’s methodology borrows from Stijns (2003) in which a gravity trade model was used to test the DD, but with an added specific term to represent the DD in the model.