IDEAS home Printed from https://ideas.repec.org/p/ags/iaae06/25289.html
   My bibliography  Save this paper

Re-testing the Resource Curse Hypothesis Using Panel Data and an Improved Measure of Resource Intensity

Author

Listed:
  • Rambaldi, Alicia N.
  • Hall, Greg
  • Brown, Richard P.C.

Abstract

Most empirical studies of the Resource Curse Hypothesis (RCH) find evidence of a strong negative relationship between a country's natural resource abundance and economic growth. We question the reliability of these findings in relation to the definitions and measures used for both resource intensity and economic growth, and the econometric testing which we consider deficient. We use an alternative, per capita resource rents measure of resource intensity that excludes renewable resources and avoids the circularity and bias of other output-related measures. Using Cluster Analysis, we compare the grouping of countries on the basis of three resource intensity definitions; viz. Sachs and Warner's (1995), Gylfason and Zoega's (2002) and our per capita rents, and find substantial differences in the resulting clustering. We then re-test the RCH econometrically using panel data and the corresponding econometric technique, as opposed to a single period-average data cross-sectional model. We test the sensitivity of our results by estimating the same model with the three different definitions of resource intensity. Previous Sach's and Warner's findings still hold when using their measure of resource intensity in our different modeling framework, while those of Gylfason and Zoega do not. Using our per capita rents measure of resource-intensity we find evidence of a positive relationship between natural resource abundance and economic growth. We conclude that the results of the test for the RCH are dependent on both the definition of resource-intensity and whether the growth is modeled with cross-sectional or panel data.

Suggested Citation

  • Rambaldi, Alicia N. & Hall, Greg & Brown, Richard P.C., 2006. "Re-testing the Resource Curse Hypothesis Using Panel Data and an Improved Measure of Resource Intensity," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25289, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae06:25289
    as

    Download full text from publisher

    File URL: http://ageconsearch.umn.edu/record/25289/files/cp060275.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Papyrakis, Elissaios & Gerlagh, Reyer, 2004. "The resource curse hypothesis and its transmission channels," Journal of Comparative Economics, Elsevier, vol. 32(1), pages 181-193, March.
    2. Syrquin, Moshe, 1988. "Patterns of structural change," Handbook of Development Economics,in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 7, pages 203-273 Elsevier.
    3. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
    4. Syrquin, M. & Chenery, H.B., 1989. "Patterns Of Development, 1950 To 1983," World Bank - Discussion Papers 41, World Bank.
    5. Osmel Manzano & Roberto Rigobon, 2001. "Resource Curse or Debt Overhang?," NBER Working Papers 8390, National Bureau of Economic Research, Inc.
    6. Neumayer, Eric, 2004. "Does the "Resource Curse" hold for Growth in Genuine Income as Well?," World Development, Elsevier, vol. 32(10), pages 1627-1640, October.
    7. David E. Bloom & Jeffrey D. Sachs, 1998. "Geography, Demography, and Economic Growth in Africa," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 29(2), pages 207-296.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jayakar, Krishna & Martin, Brandie, 2012. "Regulatory governance in African telecommunications: Testing the resource curse hypothesis," Telecommunications Policy, Elsevier, vol. 36(9), pages 691-703.

    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:iaae06:25289. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/iaaeeea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.