African Economic Growth Prospects: A Resource Curse Perspective

This study investigated the resource-growth nexus in Africa through an attempt to empirically reconcile the traditional resource curse literature with the role of technological progress as described in endogenous growth version of international trade literature. Using variables proposed to be associated with the occurrence of the curse within a panel growth model, the paper provides evidence that indeed insufficient technological progress (proxy by the share of technology embedded imports) explains the occurrence of resource curse (the negative correlation in resource-growth nexus) in the long run although the opposite effect also detected in the short run. Remarkably, while the long and short-run signs in the resource-growth nexus accord with some previous literature, our findings go a step further in explaining the negative association in the long run by the presence of slow technological progress instead of ignoring it as it is the case in conventional resource curse literature. The overall implication is that technology progress.