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Natural Resource Abundance and Economic Growth

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  • Jeffrey D. Sachs
  • Andrew M. Warner

Abstract

One of the surprising features of modern economic growth is that economies with abundant natural resources have tended to grow less rapidly than natural-resource-scarce economies. In this paper we show that economies with a high ratio of natural resource exports to GDP in 1971 (the base year) tended to have low growth rates during the subsequent period 1971-89. This negative relationship holds true even after controlling for variables found to be important for economic growth, such as initial per capita income, trade policy, government efficiency, investment rates, and other variables. We explore the possible pathways for this negative relationship by studying the cross-country effects of resource endowments on trade policy, bureaucratic efficiency, and other determinants of growth. We also provide a simple theoretical model of endogenous growth that might help to explain the observed negative relationship.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5398.

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Date of creation: Dec 1995
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Handle: RePEc:nbr:nberwo:5398

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  1. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Economic Convergence and Economic Policies," Harvard Institute of Economic Research Working Papers 1715, Harvard - Institute of Economic Research.
  2. Warner, Andrew M., 1994. "Mexico's investment collapse: debt or oil?," Journal of International Money and Finance, Elsevier, vol. 13(2), pages 239-256, April.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. The Economic Nature of the Resource Curse: Evidence
    by Daron Acemoglu and James Robinson in Why Nations Fail on 2013-05-21 12:02:00
  2. Is the â??Natural Resource Curseâ? Not Quite True?
    by Freakonomics in Freakonomics on 2011-04-04 16:00:26
  3. Recursos Naturais ou Instituições?
    by Thomas H. Kang in Oikomania on 2012-03-07 03:24:00
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Lists

This item is featured on the following reading lists or Wikipedia pages:
  1. Прокляття ресурсів in Wikipedia (Ukranian)
  2. Ressourcenfluch in Wikipedia (German)
  3. Resource curse in Wikipedia (English)
  4. Проклятие ресурсов in Wikipedia (Russian)
  5. Armut in Wikipedia (German)
  6. Maledizione delle risorse in Wikipedia (Italian)
  7. Kutukan sumber daya in Wikipedia (Indonesian)

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