EconPapers    
Economics at your fingertips  
 

Blessing and curse. The gold boom and local development in Colombia

Rafael J. Santos

World Development, 2018, vol. 106, issue C, 337-355

Abstract: I provide a microeconomic channel for the resource curse using the boom in Colombian gold mining as a case study. Identification strategies exploit trend changes in international gold prices after 2002 and regional gold production capabilities as measured by water supply (the majority of gold mining in Colombia is placer mining and water is important for industrial gold production). I find that the gold boom decreases local unemployment in the short term by 3.5%. However, given the lack of capacity to effectively ban child labor, these economic opportunities are also available for children. My results indicate that, because of the gold boom, the probability that a child works increases by 9.3% and school attendance decreases by 23.9%. Capital accumulation seems to be permanently hurt since the probability that a child is lagging three or more grades behind increases by 9%. These effects are only discernible after 2002. The human capital results can be retrieved from different databases. Furthermore, results are robust to a series of robustness checks (restricting the sample to gold producers and their neighbors, using alternative sets of controls and restricting the sample to non-migrants). Resources are a blessing in the short term but a curse for long term economic growth if human capital is productive.

Keywords: Latin America; Colombia; Resource curse; Local development; Child labor; Schooling (search for similar items in EconPapers)
JEL-codes: O13 R11 I25 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0305750X18300548
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:106:y:2018:i:c:p:337-355

Access Statistics for this article

World Development is currently edited by O. T. Coomes

More articles in World Development from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-05-10
Handle: RePEc:eee:wdevel:v:106:y:2018:i:c:p:337-355