Natural resources, economic growth and institutions – a panel approach

Nuno Torres, Oscar Afonso and Isabel Soares ()
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Isabel Soares: CEF.UP and Faculdade de Economia, Universidade do Porto

FEP Working Papers from Universidade do Porto, Faculdade de Economia do Porto

Abstract: This study re-evaluates the impact of natural resources on growth using panel data and a factor-efficiency accounting framework. The resource-curse thesis is dismissed as capital efficiency is improved by geographically-concentrated natural resources, which hinder institutional quality in recent cross-section studies. This consensus does not hold in our case even when we use unadjusted resource proxies and the standard institutional approach, as both concentrated and diffuse resources show negative effects in low institutional-quality countries. Adequate fiscal policy seems to prevent the curse in that case, but reduces the positive effect of concentrated resources found with our adjusted proxy.

Keywords: Natural resources; Economic growth; Institutions; Country Studies; Panel data (search for similar items in EconPapers)
JEL-codes: C23 N50 O13 O40 O50 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2009-10
New Economics Papers: this item is included in nep-ene, nep-env and nep-fdg
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Persistent link: https://EconPapers.repec.org/RePEc:por:fepwps:338

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