EconPapers    
Economics at your fingertips  
 

Natural Resources, Democracy and Corruption

Sambit Bhattacharyya and Roland Hodler

No 20, OxCarre Working Papers from Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford

Abstract: We study how natural resources can feed corruption and how this effect depends on the quality of the democratic institutions. Our game-theoretic model predicts that resource rents lead to an increase in corruption if the quality of the democratic institutions is relatively poor, but not otherwise. We use panel data covering the period 1980 to 2004 and 124 countries to test this theoretical prediction. Our estimates confirm that the relationship between resource rents and corruption depends on the quality of the democratic institutions. Our main results hold when we control for the effects of income, time varying common shocks, regional fixed effects and various additional covariates. They are also robust to the use of various alternative measures of natural resources, corruption and the quality of the democratic institutions,and across different samples. These findings imply that democratization might be a powerful tool to reduce corruption in resource-rich countries.

Keywords: Natural resources; democracy; political institutions; corruption (search for similar items in EconPapers)
JEL-codes: D7 O1 (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17) Track citations by RSS feed

Downloads: (external link)
https://www.economics.ox.ac.uk/materials/OxCarre/R ... /oxcarrerp200920.pdf (application/pdf)

Related works:
Journal Article: Natural resources, democracy and corruption (2010) Downloads
Working Paper: Natural Resources, Democracy and Corruption (2008) Downloads
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:oxf:oxcrwp:020

Access Statistics for this paper

More papers in OxCarre Working Papers from Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford Contact information at EDIRC.
Bibliographic data for series maintained by Melis Boya ().

 
Page updated 2020-03-31
Handle: RePEc:oxf:oxcrwp:020