Book update: resource curse

Chapter 12: Current and future challenges

Section 12.6: Cumulative impacts

Sub-section 12.6.2: National cumulative impacts

There is a growing literature from econometrics and other disciplines exploring the reality of the resource curse.

One highly cited paper is: Sachs, J. D. and A. M. Warner (2001). “The curse of natural resources.” European Economic Review 45(4-6): 827-838.  The paper provides evidence that it is real.

This entry in Wikipedia is also helpful

The association between the resource curse and the spread of HIV/AIDS 1990-2008 has been explored by Ismene Gizelis in an unpublished paper entitled “ A quiet killer” presented at the Annual Convention of the International Studies  Association (ISA), Montreal, Canada, March 16–19, 2011. “Using the latest available estimates of HIV/AIDS infected populations per total  population size (WHO/UNAIDS 2006), we find that countries that gain a higher share of  national wealth from oil extraction tend to have higher levels of infected populations, net of a  host of relevant controls, such as per capita income, regime type, the rate of prevalence in the  neighbourhood, and the history of political violence”.

On the other hand Saleem H. Ali (2009), in “Treasures of the Earth: Need, Greed, and a Sustainable Future”, argues that the resource curse is an illusion and that there are many counter examples.

An IMF working paper by Atsushi Iimi (2006) entitled “Did Botswana escape the resource curse?” argues that good governance tends to link natural resources positively with high capital growth. Botswana is cited as an example.

On the other hand, Botswana also has a very high rate of HIV infection. This raises the question, as yet unanswered, as to whether Botswana’s economic success has nevertheless been bought with a health impact.

 

One Comment

  1. Several recent books provide an interesting perspective on the resource curse in the context of oil and gas: “the curse of oil”.
    “Private Empire: ExxonMobil and American Power” by Steve Coll is beautifully understated.

    “Crude World”, by Peter Maas provides a vivid impression of what resource curse feels like in practice.

    Of course these are offered with a disclaimer – not all oil companies are the same and not all reports about their activities are accurate.

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