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Natural Resource Abundance and Economic Growth Revisited

01 Mar 2008-Vol. 21, Iss: 1, pp 43-64
TL;DR: In this paper, the authors proposed a method to solve the problem of the lack of resources in the South Korean market, by using the concept of "social media" and "social networks".
Abstract: 본 논문은 자원부국들의 천연자원 수출이 각기 다른 경제적 영향을 보이는 이유에 대해 연구하였다. 가령 라틴아메리카의 경우 다른 자원부국들과는 달리 저조한 경제성장을 보였다. 이에 대해 선행연구에서는 천연자원의 풍요가 오히려 경제성장에 부정적인 영향을 준다고 논증한 바 있다. 그러나 본 연구에서는 1인당 국민소득이 어느 수준 이상일 경우 천연자원 수출과 경제성장 간의 역의 상관관계가 존재하지 않음을 보이고 있다. 분석에 따르면, 1인당 국민소득이 낮은 라틴아메리카 국가들의 경우 풍부한 천연자원이 경제성장에 부정적인 영향을 미치는 반면, 1인당 국민소득이 높은 선진국의 경우 이러한 음의 효과가 나타나지 않았다. 이같이 천연자원 수출이 자원부국들 간 서로 다른 영향을 보인 이유는, 정부의 효율성, 법치, 부패통제 등 ‘제도의 질’이 낮은 라틴아메리카의 경우 천연자원 수출로 얻은 자원을 비효율적으로 활용하여 인적·물적 자원을 축적하지 못했으며, 이로 인해 궁극적으로 저조한 경제성장을 이루게 되었다는 데 있다.
Citations
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Journal ArticleDOI
TL;DR: The authors survey the evidence that resource dependence negatively affects economic growth, particularly working through factors closely associated with growth in developing countries, and argue that future research should better address endogeneity of dependence measures.

432 citations


Cites background from "Natural Resource Abundance and Econ..."

  • ...…is troublesome because commercial exploitation began in the majority of oilexporting states prior to 1950, leaving more than 15 years out of the analysis (see the year sample issue also in Stijns, 2005; Lederman and Maloney, 2007; Boyce and Emery, 2011; Cavalcanti et al., 2011; James 2014)....

    [...]

Journal ArticleDOI
TL;DR: In this paper, a theory consistent econometric model was developed to investigate the long run relationship between real income, the investment rate, and the real value of oil production and showed that oil abundance has a positive effect on both long run income levels and short run economic growth.
Abstract: This paper explores whether natural resource abundance is a curse or a blessing. In order to do so, we firstly develop a theory consistent econometric model, in which we show that there is a long run relationship between real income, the investment rate, and the real value of oil production. Secondly, we investigate the long-run (level) effects of natural resource abundance on domestic output as well as the short-run (growth) effects. Thirdly, we make use of a non-stationary panel approach which explicitly estimates the long-run relationships from annual data as opposed to the dynamic and static panel approaches which might in fact estimate the high-frequency relationships. Fourthly, we account for cross-country dependencies that arise potentially from oil price shocks and other unobserved common factors, and allow countries to respond differently to these shocks. Finally, we explicitly recognize that there is a substantial heterogeneity in our sample, consisting of 53 oil exporting and importing countries with annual data between 1980-2006, and adopt the methodology developed by Pesaran (2006) for estimation. This approach considers different dynamics for each country and is consistent under both cross-sectional dependence and cross-country heterogeneity. We also check the robustness of these results by using the fully modified OLS method of Pedroni (2000). Our non-stationary approach also allows for country-specific unobserved factors, such as social and human capital, to be captured in the fixed effects and the heterogeneous trends together with any omitted factors. Our estimation results, using the real value of oil production, rent or reserves as a proxy for resource endowment, reveal that oil abundance has a positive effect on both long run income levels and short run economic growth. While we accept that oil rich countries could benefit more from their natural wealth by adopting growth and welfare enhancing policies and institutions, we challenge the common view that oil abundance affects economic growth negatively.

197 citations

Journal ArticleDOI
TL;DR: This paper developed a game in which rent seeking firms interact with corrupt governments to generate the ''resource curse'' and test their predictions by adding measures of democracy and authoritarianism to existing regression models of the resource curse, and obtain support for their hypotheses.
Abstract: A puzzling piece of empirical evidence suggests that resource-abundant countries tend to grow slower than their resource-poor counterparts. We attempt to explain this phenomenon by developing a lobbying game in which rent seeking firms interact with corrupt governments. The presence or absence of political competition, as well as the potential costs of political transitions, turn out to be key elements in generating the `resource curse.? These variables define the degree of freedom that incumbent governments have in pursuing development policies that maximize surplus in the lobbying game, but put the economy off its optimal path. We test our predictions by adding measures of democracy and authoritarianism to existing regression models of the resource curse, and obtain support for our hypotheses

154 citations


Cites background from "Natural Resource Abundance and Econ..."

  • ...Stijns (2002), on the other hand, employs yet another measure (physical reserves) and finds that the curse disappears for resources other than land....

    [...]

  • ...Sutter (2000) provides an analytical study of the determinants of rebellion....

    [...]

Journal ArticleDOI
TL;DR: In this article, the authors examined the resource curse using new data on historic resource stocks and an improved econometric methodology, focusing on the relationships between resources and rule of law.
Abstract: We examine the ‘resource curse’ using new data on historic resource stocks and an improved econometric methodology. The paper distinguishes between resource abundance (stocks) and extractive intensity (flows), focusing on relationships between resources and rule of law. Previously unavailable information on past resource stocks is estimated. We find that economically large initial natural resource stocks are associated with subsequent lower levels of rule of law and do not directly affect growth, while raw resource exports do not have a significant effect on rule of law when stocks are included in the analysis but do affect average growth rates. Sample size is maximized through the use of an EMis (expectation maximization with importance sampling) algorithm to replace missing data, minimizing the bias and inefficiency associated with listwise deletion, which commonly eliminates half or more of the available data in this setting.

151 citations

Journal ArticleDOI
TL;DR: This paper showed that the correlation between growth and natural resource abundance can be negative in the absence of market and institutional failures, and that correlation is not sufficient to conclude resources are a curse, nor is it necessary to find a positive correlation between the two variables to overturn the resource curse interpretation.

144 citations


Cites background from "Natural Resource Abundance and Econ..."

  • ...See Davis (1995, 2008a, 2008b), Wright and Czelusta (2004), Stijns (2005), Bravo-Ortega and De Gregorio (2005, 2007), Lederman and Maloney (2007), Brunnschweiler (2008), Brunnschweiler and Bulte (2008), and Alexeev and Conrad (2009). benchmark to inform us as to what we should expect to observe…...

    [...]

References
More filters
Journal ArticleDOI
TL;DR: The authors evaluate the empirical basis for the so-called resource curse and find that, despite the topic's popularity in economics and political science research, this apparent paradox may be a red herring.

966 citations

Journal ArticleDOI
TL;DR: The authors survey the evidence that resource dependence negatively affects economic growth, particularly working through factors closely associated with growth in developing countries, and argue that future research should better address endogeneity of dependence measures.

432 citations

Journal ArticleDOI
TL;DR: In this paper, a theory consistent econometric model was developed to investigate the long run relationship between real income, the investment rate, and the real value of oil production and showed that oil abundance has a positive effect on both long run income levels and short run economic growth.
Abstract: This paper explores whether natural resource abundance is a curse or a blessing. In order to do so, we firstly develop a theory consistent econometric model, in which we show that there is a long run relationship between real income, the investment rate, and the real value of oil production. Secondly, we investigate the long-run (level) effects of natural resource abundance on domestic output as well as the short-run (growth) effects. Thirdly, we make use of a non-stationary panel approach which explicitly estimates the long-run relationships from annual data as opposed to the dynamic and static panel approaches which might in fact estimate the high-frequency relationships. Fourthly, we account for cross-country dependencies that arise potentially from oil price shocks and other unobserved common factors, and allow countries to respond differently to these shocks. Finally, we explicitly recognize that there is a substantial heterogeneity in our sample, consisting of 53 oil exporting and importing countries with annual data between 1980-2006, and adopt the methodology developed by Pesaran (2006) for estimation. This approach considers different dynamics for each country and is consistent under both cross-sectional dependence and cross-country heterogeneity. We also check the robustness of these results by using the fully modified OLS method of Pedroni (2000). Our non-stationary approach also allows for country-specific unobserved factors, such as social and human capital, to be captured in the fixed effects and the heterogeneous trends together with any omitted factors. Our estimation results, using the real value of oil production, rent or reserves as a proxy for resource endowment, reveal that oil abundance has a positive effect on both long run income levels and short run economic growth. While we accept that oil rich countries could benefit more from their natural wealth by adopting growth and welfare enhancing policies and institutions, we challenge the common view that oil abundance affects economic growth negatively.

197 citations

Journal ArticleDOI
TL;DR: This paper developed a game in which rent seeking firms interact with corrupt governments to generate the ''resource curse'' and test their predictions by adding measures of democracy and authoritarianism to existing regression models of the resource curse, and obtain support for their hypotheses.
Abstract: A puzzling piece of empirical evidence suggests that resource-abundant countries tend to grow slower than their resource-poor counterparts. We attempt to explain this phenomenon by developing a lobbying game in which rent seeking firms interact with corrupt governments. The presence or absence of political competition, as well as the potential costs of political transitions, turn out to be key elements in generating the `resource curse.? These variables define the degree of freedom that incumbent governments have in pursuing development policies that maximize surplus in the lobbying game, but put the economy off its optimal path. We test our predictions by adding measures of democracy and authoritarianism to existing regression models of the resource curse, and obtain support for our hypotheses

154 citations

Journal ArticleDOI
TL;DR: In this article, the authors examined the resource curse using new data on historic resource stocks and an improved econometric methodology, focusing on the relationships between resources and rule of law.
Abstract: We examine the ‘resource curse’ using new data on historic resource stocks and an improved econometric methodology. The paper distinguishes between resource abundance (stocks) and extractive intensity (flows), focusing on relationships between resources and rule of law. Previously unavailable information on past resource stocks is estimated. We find that economically large initial natural resource stocks are associated with subsequent lower levels of rule of law and do not directly affect growth, while raw resource exports do not have a significant effect on rule of law when stocks are included in the analysis but do affect average growth rates. Sample size is maximized through the use of an EMis (expectation maximization with importance sampling) algorithm to replace missing data, minimizing the bias and inefficiency associated with listwise deletion, which commonly eliminates half or more of the available data in this setting.

151 citations