Resource windfalls, political regimes and political stability

Francesco Caselli and Andrea Tesei

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We study theoretically and empirically whether natural resource windfalls affect political regimes. We show that windfalls have no effect on democracies, while they have heterogeneous political consequences in autocracies. In deeply entrenched autocracies, the effect of windfalls is virtually nil, while in moderately entrenched autocracies, windfalls significantly exacerbate the autocratic nature of the political system. To frame the empirical work, we present a simple model in which political incumbents choose the degree of political contestability and potential challengers decide whether to try to unseat the incumbents. The model uncovers a mechanism for the asymmetric impact of resource windfalls on democracies and autocracies, as well as the the differential impact within autocracies.

Keywords: democratization; commodity prices; resource curse (search for similar items in EconPapers)
JEL-codes: O10 P16 Q00 (search for similar items in EconPapers)
Date: 2016-07-13
New Economics Papers: this item is included in nep-ene and nep-pol
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Citations: View citations in EconPapers (98)

Published in Review of Economics and Statistics, 13, July, 2016, 98(3), pp. 573-590. ISSN: 0034-6535

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http://eprints.lse.ac.uk/64587/ Open access version. (application/pdf)

Related works:
Journal Article: Resource Windfalls, Political Regimes, and Political Stability (2016)
Working Paper: Resource Windfalls, Political Regimes, and Political Stability (2011)
Working Paper: Resource Windfalls, Political Regimes, and Political Stability (2011)
Working Paper: Resource Windfalls, Political Regimes, and Political Stability (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:64587

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