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The Resource Curse and its Potential Reversal


  • Boschini, Anne

    () (Department of Economics, Stockholm University.)

  • Pettersson, Jan

    () (Department of Economics)

  • Roine, Jesper

    () (SITE, Stockholm School of Economics, and IZA)


Several recent papers suggest that the negative association between natural resource intensity and economic growth can be reversed if institutional quality is high enough. We try to understand this result in more detail by decomposing the resource measure, using alternative measures of both resources and institutions, and by studying different time periods. While an institutional reversal is present in many specifications, only ores and metals interacted with the ICRG measure of institutional quality consistently have a negative growth effect but a positive interaction that turns the curse around when institutions are good enough.

Suggested Citation

  • Boschini, Anne & Pettersson, Jan & Roine, Jesper, 2012. "The Resource Curse and its Potential Reversal," Working Paper Series 2012:17, Uppsala University, Department of Economics.
  • Handle: RePEc:hhs:uunewp:2012_017

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    References listed on IDEAS

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    1. Havranek, Tomas & Horvath, Roman & Zeynalov, Ayaz, 2016. "Natural Resources and Economic Growth: A Meta-Analysis," World Development, Elsevier, vol. 88(C), pages 134-151.
    2. Badeeb, Ramez Abubakr & Lean, Hooi Hooi & Clark, Jeremy, 2017. "The evolution of the natural resource curse thesis: A critical literature survey," Resources Policy, Elsevier, vol. 51(C), pages 123-134.
    3. repec:bla:coecpo:v:35:y:2017:i:3:p:532-541 is not listed on IDEAS
    4. Edwards, Ryan B., 2016. "Mining away the Preston curve," World Development, Elsevier, vol. 78(C), pages 22-36.
    5. Shiva, Mehdi & Kwiatkowski, Andrzej, 2014. "Temper and Temperature: The Missing Link of Climate on Armed Conflicts," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-30, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Murshed, S.M. & Badiuzzaman, M. & Pulok, M.H., 2015. "Revisiting the role of the resource curse in shaping institutions and growth," ISS Working Papers - General Series 605, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    7. Araujo Rodrigues, Larissa & Luís Sauer, Ildo, 2015. "Exploratory assessment of the economic gains of a pre-salt oil field in Brazil," Energy Policy, Elsevier, vol. 87(C), pages 486-495.
    8. Antonakakis, Nikolaos & Cunado, Juncal & Filis, George & Perez de Gracia, Fernando, 2015. "The Resource Curse Hypothesis Revisited: Evidence from a Panel VAR," MPRA Paper 72085, University Library of Munich, Germany.
    9. Kim, Dong-Hyeon & Lin, Shu-Chin, 2017. "Human capital and natural resource dependence," Structural Change and Economic Dynamics, Elsevier, vol. 40(C), pages 92-102.
    10. Frédéric Gaspart & Pierre Pecher, 2015. "Ethnic inclusiveness of the central state government and economic growth in sub-Saharan Africa," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2015011, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    11. Nolazco Cama, Jose Luis & Bravo-Ortega, Claudio, 2015. "Instituciones, Recursos Naturales Y Sus Efectos En El Crecimiento Economico: Un Sistema De Ecuaciones Simultáneas En Panel De Datos
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    15. Horváth, Roman & Zeynalov, Ayaz, 2016. "Natural resources, manufacturing and institutions in post-Soviet countries," Resources Policy, Elsevier, vol. 50(C), pages 141-148.
    16. Cockx, Lara & Francken, Nathalie, 2016. "Natural resources: A curse on education spending?," Energy Policy, Elsevier, vol. 92(C), pages 394-408.
    17. Amos James Ibrahim-Shwilima, 2016. "Economic growth and nonrenewable resources: An empirical investigation," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 6(2), pages 26-41, February.
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    22. Mehdi Shiva & Andrzej Kwiatkowski, 2014. "Temper and Temperature: The Missing Link of Climate on Armed Conflicts," Dundee Discussion Papers in Economics 282, Economic Studies, University of Dundee.
    23. Daniel Kaffine & Graham A. Davis, 2013. "A simple Monte Carlo approach to examine sample robustness in growth regressions," Working Papers 2013-04, Colorado School of Mines, Division of Economics and Business.
    24. Farhadi, Minoo & Islam, Md. Rabiul & Moslehi, Solmaz, 2015. "Economic Freedom and Productivity Growth in Resource-rich Economies," World Development, Elsevier, vol. 72(C), pages 109-126.

    More about this item


    Natural Resources; Minerals; Fuels; Resource Curse; Property Rights; Institutions; Economic Growth; Development;

    JEL classification:

    • N50 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - General, International, or Comparative
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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