Page 100 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.77, # 1, 2020, pp. 100-112

DESCRIPTIVE ANALYSIS OF EMPLOYMENT IN
AZERBAIJAN: POSSIBILITIES OF THE DUTCH DISEASE

Ibrahim Niftiyev 1,2,3

1 Ph.D. candidate, Institute of Finance and International Economic Relations,
Doctoral School in Economics, University of Szeged, Szeged, Hungary.
Email: ibrahimniftiyev@gmail.com
2 Researcher, European Economy Research Center, Azerbaijan State University of

Economics (UNEC), Baku, Azerbaijan.
3 Lecturer, International School of Economics (ISE), Azerbaijan State University of

Economics (UNEC), Baku, Azerbaijan.

Received 27 December 2019; accepted 29 May 2020; published online 10 July 2020

ABSTRACT:
This paper conducts a descriptive statistical analysis of employment in Azerbaijan
covering the period between 2000 and 2018 to study the effects of the Dutch disease
hypothesis. Azerbaijan has been a research subject of the Dutch disease due to the
boom in the oil sector since independence from the Soviet Union. This paper bases
its analysis on the descriptive statistics of employed persons per sector, its year on
year growth dynamics, and cumulative growth rates. The results indicate that there
are developments in employment that are in line with the spending effect of the
Dutch disease model, as during the given time period, the mining sector did not
experience sky-high employment, and manufacturing and agriculture shrank, though
services increased their role. Moreover, constructed scatterplot matrix and conducted
Pearson's R correlation analysis shed light on the sectoral relationships among the
critical economic variables like real effective exchange rate, oil prices, oil GDP,
non-oil GDP, oil exports, and transfers from the sovereign wealth fund (SOFAZ),
etc. However, the conclusions should be drawn with a significant extension of
caution, as the descriptive investigation is extremely limited in terms of the
identification of causal relationships.

Keywords: Dutch disease, Azerbaijan economy, sectoral employment, descriptive
statistics

JEL Classification: F41, F43, Q33

1. INTRODUCTION
The economy of Azerbaijan has been analyzed according to the Dutch disease theory on a
number of occasions due to increased oil production and exports, the nature of economic

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