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Resources, conflict, and economic development in Africa

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  • Adhvaryu, Achyuta
  • Fenske, James
  • Khanna, Gaurav
  • Nyshadham, Anant

Abstract

Evidence suggests that natural resources have driven conflict and underdevelopment in modern Africa. We show that this relationship exists primarily when neighboring regions are resource-rich. When neighbors are resource-poor, own resources instead drive economic growth. To motivate the empirical study of this set of facts, we present a simple model of parties engaged in potential conflict over resources, revealing that economic prosperity is a function of equilibrium conflict prevalence, determined not just by a region's own resources but also by the resources of its neighbors. Structural estimates confirm the model's predictions, and reveal that conflict equilibria are more prevalent where institutional quality is worse.

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  • Adhvaryu, Achyuta & Fenske, James & Khanna, Gaurav & Nyshadham, Anant, 2021. "Resources, conflict, and economic development in Africa," Journal of Development Economics, Elsevier, vol. 149(C).
    • Handle: RePEc:eee:deveco:v:149:y:2021:i:c:s0304387820301735
    DOI: 10.1016/j.jdeveco.2020.102598
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    2. Fan, Meiting & Li, Mengxu & Liu, Jianghua & Shao, Shuai, 2022. "Is high natural resource dependence doomed to low carbon emission efficiency? Evidence from 283 cities in China," Energy Economics, Elsevier, vol. 115(C).
    3. Stoop, Nik & Verpoorten, Marijke & van der Windt, Peter, 2019. "Artisanal or industrial conflict minerals? Evidence from Eastern Congo," World Development, Elsevier, vol. 122(C), pages 660-674.
    4. Ang, James B. & Gupta, Satyendra Kumar, 2018. "Agricultural yield and conflict," Journal of Environmental Economics and Management, Elsevier, vol. 92(C), pages 397-417.
    5. Roland Hodler & Paul Schaudt & Alberto Vesperoni, 2023. "Mining for Peace," CESifo Working Paper Series 10207, CESifo.
    6. Nguyen, Minh-Hoang, 2021. "Resource curse - Wikipedia," OSF Preprints 36uyb, Center for Open Science.
    7. Boxell, Levi & Dalton, John T. & Leung, Tin Cheuk, 2019. "The Slave Trade and Conflict in Africa, 1400-2000," MPRA Paper 94468, University Library of Munich, Germany.
    8. John D. Huber & Laura Mayoral, 2019. "Group inequality and the severity of civil conflict," Journal of Economic Growth, Springer, vol. 24(1), pages 1-41, March.
    9. Martin Gassebner & Paul Schaudt & Melvin H. L. Wong, 2020. "Armed Groups in Conflict: Competition and Political Violence in Pakistan," CESifo Working Paper Series 8372, CESifo.
    10. Victoire Girard & Nicolas Berman & Mathieu Couttenier, 2020. "Natural resources and the salience of ethnic identities," NOVAFRICA Working Paper Series wp2007, Universidade Nova de Lisboa, Nova School of Business and Economics, NOVAFRICA.
    11. Sini, Snow & Abdul-Rahim, A.S. & Sulaiman, Chindo, 2021. "Does natural resource influence conflict in Africa? Evidence from panel nonlinear relationship," Resources Policy, Elsevier, vol. 74(C).

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    More about this item

    Keywords

    Conflict; Resource curse; Institutions; Nighttime lights; Africa;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts

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