Section ii illustrates the relationship between resource richness, growth, and governance. Determinate factors of the resource curse in colombia, norway, botswana, and venezuela introduction as shown in much of the literature on international development natural resource deposits do not usually bode well for either the positive economic or the politi. Extension inventory by jerry reenc reat est engineering and. Countries with large endowments of natural resources, such as oil and gas, often do worse than their poorer neighbors. In the last quarter century, we have seen the surprising and sobering consequences of this wealth, producing what is now known as the resource curse. Escaping the resource curse columbia university press. Challenges in development and globalization popular books report browse more videos. The resource curse or dutch disease tries to explain why countries that are richer in natural resources are poorer, have less economic growth and are less democratic. The case of indonesia andrew rosser journal of contemporary asia. The dutch disease syndrome is only partly taken into account. Because a similar challenge faces other developing nations, lessons learned. Escaping the resource curse initiative for policy dialogue.
When used well, these resources can create greater prosperity for current and future. Escaping the resource curse, by a variety of authors including joseph stiglitz and jeffrey d. Escaping the resource curse, macartan humphreys, jeffrey d. In turn, that could lead to more democratic and transparent decisionmaking. Governance natural resources and post conflict peacebuilding. In the 1960s, norway lagged behind its scandinavian neighbors in the aggregate value of economic production per capita, as it had for decades.
Escaping the resource curse lays out a path for radically improving the management of the worlds natural resources. The global financial crisis and subsequent fall in state oil revenue drives a loanseeking. The resource curse is therefore certainly a surprising empirical result showing a negative relationship between the wealth of natural resources and their economic growth torres et al. It takes a long look at the processes of oil production in a nation state, and how these processes can reduce potential incomes for the state, whether from royalties. The study of the resource curse, and of governance and corruption more gener ally, began properly gaining traction as a. In this context, indonesias rapid growth during the 1970s and 1980s seems remarkable. Countries with large endowments of natural resources, such as oil and gas, often perform worse in terms of economic development and good governance than do countries with fewer resources. It is becoming increasingly clear that past policies have not provided the benefits they promised. Policy brief 4 august 20 policy brief 4 august 204 escaping the resource curse in subsaharan africa escaping the resource curse in subsaharan africa 5 despite the downsides, the benefits from the extraction and use of natural resources are considerable. Escaping the natural resource curse and the dutch disease.
Oil, corruption and the resource curse harvard university. Escaping the resource curse initiative for policy dialogue at columbia. Evidence from botswana and the rest of the world atsushi iimi it is commonly accepted that resourcerich economies tend to fail in accelerating growth because of various adverse effects of abundant natural resources, such as dutch disease and. Analytic narratives on economic growth princeton university press, 2003, pp. Yet countries that are abundantly endowed with such natural resources often encounter pitfalls that interfere with the expected superior economic performance.
Why was indonesia able to grow strongly and what are the implications of its experience for other resource abundant countries. But oil alone cannot explain norways growth, since sachs and warner 2001 show that resource gifts often reverse growth, making oil a curse, not a blessing. It is commonly accepted that resourcerich economies tend to fail in accelerating growth because of various adverse effects of abundant natural resources, such as dutch disease and rent seeking. This is a timely and important contribution to the debate on the socalled resource curse and how to avoid itespecially important in a time of concern about energy security and sustainable economic development. If indeed natural resource wealth leads to poorquality institutions in the first place there is of course little chance for. It finds that governance determines the extent to which. Abstract numerous studies have suggested that natural resource abundance is bad for development. Proponents of the resource curse have paid less attention to the conditions that bring about or hinder positive institutional change in countries outside the oecd. Pedro argues that resource demand offers africas ore and oilrich countries an opportunity to secure more revenues for public purses and to create more jobs. Request pdf escaping the resource curse the abstract for this document is available on csa illumina.
Since emerging from decades of conflict in 2002, angola has been growing at a scorching doubledigit rate, led by its oil industry. Hks faculty research working paper series rwp12014, john f. But the nation remains beset with seemingly intractable problems. Download escaping the resource curse initiative for policy dialogue at columbia. Paradoxically, despite the prospects of wealth and opportunity that accompany the discovery and extraction of. Further reproduction prohibited without permission. The first explanation, sug gested by prebisch 1950 and singer 1950, is known as prebischsinger hypothesis. Stiglitz resource curse is the term used to describe the failure of resourcerich countries to benefit from their natural wealth. To view the abstract, click the abstract button above the document title. Developing governance and investment frameworks to leverage the bene ts of energy development for rural prosperity. Norways catching up with and forging ahead of its neighbors growth studies show, counter to intuition, that the discovery of a natural resource may be a curse rather than a blessing since resource rich countries grow slower than others. If youre looking for a free download links of escaping the resource curse initiative for policy dialogue pdf, epub, docx and torrent then this site is not for you. A survey of diagnoses and some prescriptions oil, minerals, and agricultural resources can bring great riches to those who possess them.
Challenges in development and globalization humphreys, macartan, sachs, jeffrey d. The impact is the outcome that determines whether resources has become a blessing or a curse stevens, 2003. An inventory of extension activities for the project escaping the resource curse. The contributors show that solutions to the resource curse do exist. Angola and the resource curse case harvard business school.
The resource curse the political and economic challenges of natural resource wealth nrgi reader march 2015 countries with nonrenewable resource wealth face both an opportunity and a challenge. This is allencompassing and will harmonise the various theoretical strand within the literature. Escaping the resource curse isbn 9780231141963 pdf epub. This resource curse, which is also referred to as the kuznets trap kuznets 1955, is depleting western chinas natural resources, accompanied by accelerating environmental degradation. I argue that its rapid growth was not simply a matter of policy elites. This brings into perspective the suggestion for a change of name from resource curse to resource impact. By embedding transparency and ensuring accountability of naturalresource management, countries with potential, or already discovered mineral wealth can take great strides towards escaping the resource curse. For countries emerging from conflict and embarking on a crucial transition and reconstruction phase, the need to do so is even more critical. Escaping the resource curse in china pubmed central pmc.
Escaping the resource curse 1 contents introduction macartan humphreys, jeffrey sachs and joseph stiglitz 4 section i. Sachs, is an interesting look at the resource curse with special attention to oil. Several explanations for the resource curse have been offered in the literature. There is a curious phenomenon that social scientists call the resource curse auty 1993. The wealth derived from natural resources can have a tremendous impact on the economics and politics of producing countries.
Perversely, many countries rich in natural resources are poorer and more miserable than countries that are less well endowed. Using the latest crosscountry data, this study empirically readdresses the question of whether resource abundance can contribute to growth. Norways catching up with and forging ahead of its neighbors growth studies show, counter to intuition, that the discovery of a natural resource may be a curse rather than a blessing since resourcerich countries grow slower than others. When and why norway caught up with and forged ahead of its neighbors abstract. The case of indonesia numerous studies have suggested that natural resource abundance is bad for development. While an extensive literature on the resource curse exists, few books attempt to tackle this issue by drawing on both theory and. Moreover, there is the possibility of contracting the dutch disease, which involves a rapid and substantial contraction of the traded goods sector.