The Resource Curse Revisited and Revised: A Tale of Paradoxes and Red Herrings

Christa Brunnschweiler and Erwin Bulte

No 06/61, CER-ETH Economics working paper series from CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich

Abstract: We critically evaluate the empirical basis for the so-called resource curse and find that, despite the topic’s popularity in economics and political science research, this apparent paradox is a red herring. The most commonly used measure of ‘resource abundance’ can be more usefully interpreted as a proxy for ‘resource dependence’—endogenous to underlying institutional factors. In multiple estimations that combine resource abundance and dependence, institutional and constitutional variables, we find that (i) resource abundance, constitutions and institutions determine resource dependence, (ii) resource dependence does not affect growth, and (iii) resource abundance positively affects growth and institutional quality.

Keywords: Natural resource curse; economic growth; growth regressions; political regimes; institutions; constitutions (search for similar items in EconPapers)
JEL-codes: O11 O13 Q0 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2006-12
New Economics Papers: this item is included in nep-ene and nep-env
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Citations: View citations in EconPapers (21)

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Related works:
Journal Article: The resource curse revisited and revised: A tale of paradoxes and red herrings (2008)
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