What Turns a Blessing into a Curse? The Political Economy of Natural Resource Wealth

Syed Mansoob Murshed
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Syed Mansoob Murshed: The Hague, The Netherlands.

The Pakistan Development Review, 2007, vol. 46, issue 4, pages 351-377

Abstract: I review the relationship between natural resource endowment type and economic growth in developing countries. Certain types of natural resources, such as oil and minerals, tend to exhibit concentrated production and revenue patterns, while revenue flows from other resources such as agriculture are more diffuse. Most developing countries that export products from the first group have been prone to growth failure in recent times. The most important channels are political economy mechanisms, where there are negative relationships between natural resource rents and institutional development. An explicit model of growth collapse with micro-foundations in rent-seeking contests that have increasing returns in rent-seeking outlays is presented.

Keywords: Endowment Type; Growth; Institutions (search for similar items in EconPapers)
JEL-codes: O13 O40 Q33 (search for similar items in EconPapers)
Date: 2007
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