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Secession with Natural Resources

Author

Listed:
  • Amrita Dhillon
  • Pramila Krishnan
  • Manasa Patnam
  • Carlo Perroni

Abstract

We look at the formation of new Indian states in 2001 to uncover the effects of political secession on the comparative economic performance of natural resource rich and natural resource poor areas. Resource rich constituencies fared comparatively worse within new states that inherited a relatively larger proportion of natural resources. We argue that these patterns reflect how political reorganisation affected the quality of state governance of natural resources. We describe a model of collusion between state politicians and resource rent recipients that can account for the relationships we see in the data between natural resource abundance and post-break-up local outcomes.

Suggested Citation

  • Amrita Dhillon & Pramila Krishnan & Manasa Patnam & Carlo Perroni, 2020. "Secession with Natural Resources," The Economic Journal, Royal Economic Society, vol. 130(631), pages 2207-2248.
    • Handle: RePEc:oup:econjl:v:130:y:2020:i:631:p:2207-2248.
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    File URL: http://hdl.handle.net/10.1093/ej/ueaa033
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    Cited by:

    1. Simplice A. Asongu & Nicholas M. Odhiambo, 2024. "Governance quality and trade performance in Sub‐Saharan Africa," World Affairs, John Wiley & Sons, vol. 187(1), pages 78-93, March.
    2. Vikash Vaibhav & K. V. Ramaswamy, 2024. "State-size and economic growth: evidence from state reorganization in India," Indian Economic Review, Springer, vol. 59(1), pages 177-203, October.
    3. Simplice A. Asongu & Nicholas M. Odhiambo, 2022. "The paradox of governance and natural resource rents in Sub-Saharan Africa," Journal of Africa SEER Centre(ASC) 22/010, Africa SEER Centre(ASC).
    4. Andersen, Jørgen Juel & Sørensen, Rune Jørgen, 2022. "The zero-rent society: Evidence from hydropower and petroleum windfalls in Norwegian local governments," Journal of Public Economics, Elsevier, vol. 209(C).

    More about this item

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making

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