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Natural Resources and Economic Growth: The Role of Investment

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  • Thorvaldur Gylfason
  • Gylfi Zoega

Abstract

Is it possible that relying too heavily on natural resources affects saving and investment in a way that hampers economic growth? – and thus, in the long run, the level of output per capita. This paper reviews the literature, explores the data and compares and contrasts the explanatory power and interplay of natural resources and civil liberties, our proxy for institutional variables currently under scrutiny in the literature. We propose that natural resources may be viewed as an exogenous factor that hampers economic development and investment as well as institutions.

Suggested Citation

  • Thorvaldur Gylfason & Gylfi Zoega, 2004. "Natural Resources and Economic Growth: The Role of Investment," DEGIT Conference Papers c009_011, DEGIT, Dynamics, Economic Growth, and International Trade.
    • Handle: RePEc:deg:conpap:c009_011
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    More about this item

    Keywords

    Economic growth; natural resources; investment;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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