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Is Development Path Dependent or Political? A Reinterpretation of Mineral-Dependent Development in Botswana

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  • Amy Poteete

Abstract

Poor management of earnings from valuable natural resources results in a syndrome known as Dutch Disease, characterised by real exchange rate appreciation, high labour costs, and structural imbalances in economic development. Often a product of rentier politics, Dutch Disease undermines long-term economic performance in resource dependent economies resulting in a 'resource curse'. The conventional wisdom argues that institutions and state development at the time of a resource boom lock countries into divergent developmental trajectories. I argue that political coalitions lay the foundation for development of state and other institutions, and that changes in coalitions drive changes in policy responses to resource booms. Botswana's experience illustrates the argument. Botswana has not entirely avoided symptoms of Dutch Disease, but has kept them largely in check despite the fragility of state institutions when diamonds were discovered. A broad and stable political coalition during the first decades of independence encouraged adoption of pro-growth policies and institutions. Rather than lock the country into a persistent development trajectory, these institutions left room for changes in political coalitions. As political coalitions change, economic policies and performance are also likely to change.

Suggested Citation

  • Amy Poteete, 2009. "Is Development Path Dependent or Political? A Reinterpretation of Mineral-Dependent Development in Botswana," Journal of Development Studies, Taylor & Francis Journals, vol. 45(4), pages 544-571.
  • Handle: RePEc:taf:jdevst:v:45:y:2009:i:4:p:544-571
    DOI: 10.1080/00220380802265488
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    References listed on IDEAS

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    1. Harvey, Charles, 1992. "Botswana: Is the Economic Miracle Over?," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 1(3), pages 335-368, November.
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    Cited by:

    1. Sam Hickey, 2012. "Thinking about the politics of inclusive development: towards a relational approach," Global Development Institute Working Paper Series esid-001-12, GDI, The University of Manchester.
    2. repec:eee:touman:v:32:y:2011:i:5:p:1223-1228 is not listed on IDEAS
    3. Kjetil Bjorvatn & Mohammad Reza Farzanegan, 2014. "Resource Rents, Power, and Political Stability," CESifo Working Paper Series 4727, CESifo Group Munich.
    4. Laura Routley, 2014. "Developmental States in Africa? A Review of Ongoing Debates and Buzzwords," Development Policy Review, Overseas Development Institute, vol. 32(2), pages 159-177, March.
    5. Tohid Atashbar, 2013. "Iranian Disease: Why a Developing Country's Government Did Not Listen to Economists' Advices," American Journal of Economics and Sociology, Wiley Blackwell, vol. 72(3), pages 732-760, July.
    6. Anthony Bebbington, 2013. "Natural resource extraction and the possibilities of inclusive development: politics across space and time," Global Development Institute Working Paper Series esid-021-13, GDI, The University of Manchester.
    7. Makochekanwa, Albert, 2009. "Chiadzwa Diamonds: Zimbabwe’s potential economic recovery option," MPRA Paper 22488, University Library of Munich, Germany.
    8. Vittorio Daniele, 2011. "Natural Resources and the 'Quality' of Economic Development," Journal of Development Studies, Taylor & Francis Journals, vol. 47(4), pages 545-573.
    9. Elbra, Ainsley D., 2013. "The forgotten resource curse: South Africa's poor experience with mineral extraction," Resources Policy, Elsevier, vol. 38(4), pages 549-557.
    10. Sen, Kunal, 2013. "The Political Dynamics of Economic Growth," World Development, Elsevier, vol. 47(C), pages 71-86.
    11. Giles Mohan & Kojo Pumpuni Asante, 2015. "Transnational capital and the political settlement of Ghana’s oil economy," Global Development Institute Working Paper Series esid-049-15, GDI, The University of Manchester.
    12. Bjorvatn, Kjetil & Farzanegan, Mohammad Reza & Schneider, Friedrich, 2012. "Resource Curse and Power Balance: Evidence from Oil-Rich Countries," World Development, Elsevier, vol. 40(7), pages 1308-1316.
    13. Frederick Golooba-Mutebi & Sam Hickey, 2013. "Investigating the links between political settlements and inclusive development in Uganda: towards a research agenda," Global Development Institute Working Paper Series esid-020-13, GDI, The University of Manchester.
    14. Sam Hickey & Badru Bukenya & Angelo Izama & William Kizito, 2015. "The political settlement and oil in Uganda," Global Development Institute Working Paper Series esid-048-15, GDI, The University of Manchester.

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