Management of Resource Policy: How Mongolia Passes the Test

Jiří Mičánek and Petr Blížkovský
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Jiří Mičánek: Úvoz 84, 602 00 Brno, Czech Republic
Petr Blížkovský: General Secretariat Council of the EU, rue de la Loi 185, Brussels, 1048, Belgium

Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 2016, vol. 64, issue 1, 297-305

Abstract: Mongolia is quickly changing nowadays. This is also thanks to discoveries of enormous mineral wealth. Copper, coal, iron ore and gold in particular are responsible for an amazing growth performance that Mongolia continues to demonstrate over the last decade. As literature demonstrates, large windfalls in natural resources revenues often turn into a curse in the long run, inspiring the term 'resource curse'. Resource abundant countries are often confronted with negative economic, social and political outcomes. Poor management of resource revenues is often the core of this problem.The article looks at the case of Mongolia. It runs eight tests related to competitiveness, to quality of institutions, to GDP and to growth rate determined by global mineral prices. The results are mixed: tests of institutional quality and volatility of prices has proved the hypothesis, however, the GDP growth and terms of trade tests haven't shown any negative influence.The results offer a mixed picture (6 tests supporting and 2 tests not-supporting the hypothesis). At this stage, in overall, Mongolia is not yet facing the resource curse. Policy recommendations concern much needed stabilisation of the economy, improvement of institutional quality through legal reforms, and diversification of the economy.

Keywords: Mongolia; resource curse; institutions; diversification; governance; economic growth; economic development; Dutch disease (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:mup:actaun:actaun_2016064010297

DOI: 10.11118/actaun201664010297

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