Neoclassical Growth and the Natural Resource Curse Puzzle

María Guilló and Fidel Pérez-Sebastián ()
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Fidel Pérez-Sebastián: Departamento de Fundamentos del Análisis Económico, Postal: Universidad de Alicante, Campus de San Vicente, , E-03080 Alicante,, Spain
Authors registered in the RePEc Author Service: Fidel Perez Sebastian

No 12-14, QM&ET Working Papers from University of Alicante, D. Quantitative Methods and Economic Theory

Abstract: The traditional view that natural riches increase the wealth of nations has been recently challenged by empirical findings that point out that natural inputs are negatively related to growth. This paper shows, within a two-sector neo-classical growth model with international trade in goods, that these two views can be reconciled. Natural inputs directly affect both long-run income and transitional growth. These two effects can be positive or negative depending on input elasticities. Furthermore, they go in opposite directions, creating a tension that complicates the interpretation of estimated-coefficient signs in growth regressions. Quantitative results show that the two effects can be significant.

Keywords: neoclassical growth; resource curse; convergence (search for similar items in EconPapers)
JEL-codes: F11 F43 O11 O13 O41 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2012-07-26
New Economics Papers: this item is included in nep-dge, nep-ene, nep-env and nep-fdg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Neoclassical growth and the natural resource curse puzzle (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ris:qmetal:2012_014

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