The Illusory Leader: Natural Resources, Taxation and Accountability

Eoin F. McGuirk () and Eoin F. McGuirk
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Eoin F. McGuirk: Institute for International Integration Studies, Trinity College Dublin
Authors registered in the RePEc Author Service: Eoin McGuirk

The Institute for International Integration Studies Discussion Paper Series from IIIS

Abstract: This paper proposes and tests a mechanism through which the natural resource curse can operate. I posit that, in the presence of high natural resource rents, leaders lower the burden of taxation on citizens in order to reduce the demand for democratic accountability. The theory is tested using micro-level data from public opinion surveys across 15 sub-Saharan countries, in addition to country-level data on natural resource rents, taxation and election proximity. It is found that an increase in natural resource rents decreases perceived tax enforcement, which in turn reduces the demand for regular, open and honest elections. Results are robust to alternative specifications. A supplementary analysis reveals that, consistent with the two-period model proposed, the effects are more acute closer to national elections. The findings support political-economy explanations of how natural resources affect economies, in which resource rents are purported to influence the decisions of the political elite through increased returns to staying in power.

Keywords: Democracy; Political Economy; Natural Resources; Curses; Africa (search for similar items in EconPapers)
JEL-codes: D73 O13 O55 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2010-05
New Economics Papers: this item is included in nep-afr, nep-env, nep-pol and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Journal Article: The illusory leader: natural resources, taxation and accountability (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:iis:dispap:iiisdp327

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