Oil and Conflict: What Does the Cross Country Evidence Really Show?

Anca M. Cotet and Kevin Tsui ()

American Economic Journal: Macroeconomics, 2013, vol. 5, issue 1, 49-80

Abstract: This paper re-examines the effect of oil wealth on political violence. Using a unique historical panel dataset of oil discoveries, we show that simply controlling for country fixed effects removes the statistical association between the value of oil reserves and civil war onset. Other macro-political violence measures, such as coup attempts, are also uncorrelated with oil wealth. To further address endogeneity concerns, we exploit changes in oil reserves due to randomness in the success of oil explorations. We find little robust evidence that oil discoveries increase the likelihood of political violence. Rather, oil discoveries increase military spending in nondemocratic countries. (JEL D74, H56, O17, Q34, Q41)

JEL-codes: D74 H56 O17 Q34 Q41 (search for similar items in EconPapers)
Date: 2013
Note: DOI: 10.1257/mac.5.1.49
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Citations: View citations in EconPapers (226)

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Working Paper: Oil and Conflict: What Does the Cross-Country Evidence Really Show? (2010)
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