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Intensive and extensive margins of mining and development: Evidence from Sub-Saharan Africa

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  • Mamo, Nemera
  • Bhattacharyya, Sambit
  • Moradi, Alexander

Abstract

What are the economic consequences of mining in Sub-Saharan Africa? Using a panel of 3,635 districts from 42 Sub-Saharan African countries for the period 1992 to 2012 we investigate the effects of mining on living standards (measured by night-lights and household/cohort characteristics from Demographic and Health Surveys) and public service provisions (from Afrobarometer). Night-lights increase in mining districts when mineral production expands (intensive margin), but large effects are mainly associated with new discoveries and new production (extensive margin). We identify the effect by carefully choosing feasible but not yet mined districts as a control group. In addition, we exploit first, single-first, giant and major discoveries as exogenous news shocks. Mines in Africa exhibit enclave characteristics as we find little evidence of significant spillovers to other districts.

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  • Mamo, Nemera & Bhattacharyya, Sambit & Moradi, Alexander, 2019. "Intensive and extensive margins of mining and development: Evidence from Sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 139(C), pages 28-49.
    • Handle: RePEc:eee:deveco:v:139:y:2019:i:c:p:28-49
    DOI: 10.1016/j.jdeveco.2019.02.001
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    More about this item

    Keywords

    Mineral discovery; Mineral production; Night-time lights;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development

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