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Contesting resources – rent seeking, conflict and the natural resource curse

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  • Katharina Wick

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  • Erwin Bulte

Abstract

A growing empirical literature links natural resource abundance and “pointiness” to impeded economic growth and civil strife. We develop rent seeking and conflict models that capture the most salient features of contests for resource rents, and show how both resource abundance and geographical clustering can be associated with intense contests and sub-optimal economic performance. However, we also show that these relationships are not necessarily monotonous – pointiness can trigger more intense contests but can also facilitate the coordination on peaceful outcomes. Finally we show that contesting resources through violent conflict may yield superior outcomes (from an economy-wide perspective) than contests through rent seeking. Copyright Springer Science + Business Media, Inc. 2006

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Bibliographic Info

Article provided by Springer in its journal Public Choice.

Volume (Year): 128 (2006)
Issue (Month): 3 (September)
Pages: 457-476

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Handle: RePEc:kap:pubcho:v:128:y:2006:i:3:p:457-476

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Web page: http://www.springerlink.com/link.asp?id=100332

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  1. Torvik, Ragnar, 2002. "Natural resources, rent seeking and welfare," Journal of Development Economics, Elsevier, vol. 67(2), pages 455-470, April.
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  4. Gylfason, Thorvaldur & Zoega, Gylfi, 2001. "Natural Resources and Economic Growth: The Role of Investment," CEPR Discussion Papers 2743, C.E.P.R. Discussion Papers.
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  7. Carlos Leite & Jens Weidmann, 1999. "Does Mother Nature Corrupt," IMF Working Papers 99/85, International Monetary Fund.
  8. Neary, Hugh M, 1997. " A Comparison of Rent-Seeking Models and Economic Models of Conflict," Public Choice, Springer, vol. 93(3-4), pages 373-88, December.
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  12. Ian Bannon & Paul Collier, 2003. "Natural Resources and Violent Conflict : Options and Actions," World Bank Publications, The World Bank, number 15047, August.
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  15. Sachs, Jeffrey D. & Warner, Andrew M., 2001. "The curse of natural resources," European Economic Review, Elsevier, vol. 45(4-6), pages 827-838, May.
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  17. Baye, M.R. & Kovenock, D., 1993. "The Solution to the Tullock Rent-Seeking Game When R > 2: Mixed Strategy Equilibria and Mean Dissipation Rates," Papers 9368, Tilburg - Center for Economic Research.
  18. Erwin H. Bulte & Richard Damania & Robert T. Deacon, 2004. "Resource Abundance, Poverty and Development," Working Papers 04-03, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
  19. Grossman, Herschel I, 1994. "Production, Appropriation, and Land Reform," American Economic Review, American Economic Association, vol. 84(3), pages 705-12, June.
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  22. Hugh Neary, 1997. "A comparison of rent-seeking models and economic models of conflict," Public Choice, Springer, vol. 93(3), pages 373-388, December.
  23. Matthew J. Baker, 2003. "An Equilibrium Conflict Model of Land Tenure in Hunter-Gatherer Societies," Journal of Political Economy, University of Chicago Press, vol. 111(1), pages 124-173, February.
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Cited by:
  1. Rabah Arezki & Frederick van der Ploeg, 2008. "Can The Natural Resource Curse Be Turned Into A Blessing? The Role of Trade Policies and Institutions," OxCarre Working Papers 001, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
  2. Al-Ubaydli, Omar, 2012. "Natural resources and the tradeoff between authoritarianism and development," Journal of Economic Behavior & Organization, Elsevier, vol. 81(1), pages 137-152.
  3. Rabah Arezki & Frederik van der Ploeg, 2007. "Can the Natural Resource Curse Be Turned Into a Blessing? T+L3479he Role of Trade Policies and Institutions," IMF Working Papers 07/55, International Monetary Fund.
  4. Azarhoushang, Behzad & Rukavina, Marko, 2014. "Resource curse: A comparative study," IPE Working Papers 30/2014, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
  5. Oskenbayev, Yessengali & Karimov, Aziz, 2013. "Is Kazakhstan vulnerable to natural resource curse?," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  6. Janus, Thorsten, 2012. "Natural resource extraction and civil conflict," Journal of Development Economics, Elsevier, vol. 97(1), pages 24-31.
  7. Petros G. Sekeris, 2012. "The Tragedy of the Commons in a Violent World," Working Papers 1213, University of Namur, Department of Economics.
  8. Paul Collier & Benedikt Goderis, 2007. "Commodity Prices, Growth, and the Natural Resource Curse: Reconciling a Conundrum," CSAE Working Paper Series 2007-15, Centre for the Study of African Economies, University of Oxford.
  9. Markwardt, Gunther & Farzanegan, Mohammad & Leßmann, Christian, 2013. "Natural-resource rents and internal conflicts - Can decentralization lift the curse?," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79940, Verein für Socialpolitik / German Economic Association.
  10. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
  11. Wick, A.K., 2008. "Conflicts, Development and Natural Resources: An Applied Game Theoretic Approach," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3160797, Tilburg University.
  12. Frederick van der Ploeg, 2008. "Challenges and Opportunities for Resource Rich Economies," OxCarre Working Papers 005, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.

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