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A regional resource curse? A synthetic-control approach to oil extraction in Basilicata, Italy

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  • Pellegrini, Lorenzo
  • Tasciotti, Luca
  • Spartaco, Andrea

Abstract

Basilicata is a region of Southern Italy where the expansion of oil operations in the 1990s was promoted as an opportunity to foster economic development. Flash-forward to 2020, Basilicata is one of the poorest regions in Italy despite the exploitation of some of the largest onshore hydrocarbon reserves within the European Union. The coincidence of high poverty rates with abundant natural resources suggests that the region is experiencing a ‘resource curse’; however, socio-economic problems predate the oil boom, complicating any causality claim. To disentangle and estimate the effects of oil exploitation, we employ the synthetic control method that compares the actual trends of development indicators of Basilicata with a counterfactual that is created by taking a weighted average of trends of other Italian regions –a ‘synthetic’ Basilicata.

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  • Pellegrini, Lorenzo & Tasciotti, Luca & Spartaco, Andrea, 2021. "A regional resource curse? A synthetic-control approach to oil extraction in Basilicata, Italy," Ecological Economics, Elsevier, vol. 185(C).
    • Handle: RePEc:eee:ecolec:v:185:y:2021:i:c:s0921800921000999
    DOI: 10.1016/j.ecolecon.2021.107041
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    5. Jianmei Zhang & Jiwei Zhu & Yu Liu & Nan Lu & Wenxing Fang, 2022. "The Economic Impact of Payments for Water-related Ecosystem Services on Protected Areas: a Synthetic Control Analysis," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(5), pages 1535-1551, March.
    6. Lorenzo Pellegrini & Murat Arsel & Gorka Muñoa & Guillem Rius-Taberner & Carlos Mena & Martí Orta-Martínez, 2024. "The atlas of unburnable oil for supply-side climate policies," Nature Communications, Nature, vol. 15(1), pages 1-13, December.
    7. Matti, Josh & Zhou, Yang, 2022. "Money is money: The economic impact of BerkShares," Ecological Economics, Elsevier, vol. 192(C).
    8. Franklin Obeng-Odoom, 2023. "Spatial political economy: the case of metropolitan industrial policy," Review of Evolutionary Political Economy, Springer, vol. 4(1), pages 137-163, April.

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