Resource rents, power, and political stability
We study the association between resource rents and political stability, highlighting the importance of the distribution of political power as a mediating factor. We present a simple theoretical model showing that increased rents are likely to be positively associated with the stability of a powerful incumbent while destabilizing a less powerful incumbent. Our empirical analysis confirms this prediction: Using panel data for more than 120 countries from 1984-2009, our results show that rents can promote political stability, but only when the political power is sufficiently concentrated. Indeed, if the incumbent is sufficiently weak, rents fuel instability. Our main results hold when we control for the effects of income, quality of institutions, time varying common shocks, country fixed effects and various additional covariates
|Date of creation:||2014|
|Date of revision:|
|Publication status:||Forthcoming in|
|Contact details of provider:|| Postal: |
Web page: http://www.uni-marburg.de/fb02/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Arellano, Manuel & Bover, Olympia, 1995.
"Another look at the instrumental variable estimation of error-components models,"
Journal of Econometrics,
Elsevier, vol. 68(1), pages 29-51, July.
- M Arellano & O Bover, 1990. "Another Look at the Instrumental Variable Estimation of Error-Components Models," CEP Discussion Papers dp0007, Centre for Economic Performance, LSE.
- Mohammad Reza Farzanegan & Christian Lessmann & Gunther Markwardt, 2013.
"Natural-Resource Rents and Internal Conflicts - Can Decentralization Lift the Curse?,"
CESifo Working Paper Series
4180, CESifo Group Munich.
- Markwardt, Gunther & Farzanegan, Mohammad & Leßmann, Christian, 2013. "Natural-resource rents and internal conflicts - Can decentralization lift the curse?," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79940, Verein für Socialpolitik / German Economic Association.
- Stephen Knack & Philip Keefer, 1995. "Institutions And Economic Performance: Cross-Country Tests Using Alternative Institutional Measures," Economics and Politics, Wiley Blackwell, vol. 7(3), pages 207-227, November.
- Bjorvatn Kjetil & Farzanegan Mohammad Reza & Schneider Friedrich, 2013. "Resource Curse and Power Balance: Evidence from Iran," Review of Middle East Economics and Finance, De Gruyter, vol. 9(2), pages 133-158, August.
- Rabah Arezki & Thorvaldur Gylfason, 2011. "Resource Rents, Democracy and Corruption: Evidence from Sub-Saharan Africa," CESifo Working Paper Series 3575, CESifo Group Munich.
- 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.
- Andersen, Jørgen Juel & Aslaksen, Silje, 2013. "Oil and political survival," Journal of Development Economics, Elsevier, vol. 100(1), pages 89-106.
- Philippe Le Billon, 2003. "Buying peace or fuelling war: the role of corruption in armed conflicts," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(4), pages 413-426.
- Fredriksson, Per G. & Svensson, Jakob, 2003. "Political instability, corruption and policy formation: the case of environmental policy," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1383-1405, August.
- Jinjarak, Yothin, 2009. "Trade variety and political conflict: Some international evidence," Economics Letters, Elsevier, vol. 103(1), pages 26-28, April.
- Paul Collier & Anke Hoeffler, 2004.
"Greed and Grievance in Civil War,"
Development and Comp Systems
- Arellano, Manuel & Bond, Stephen, 1991.
"Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations,"
Review of Economic Studies,
Wiley Blackwell, vol. 58(2), pages 277-97, April.
- Tom Doan, . "RATS program to replicate Arellano-Bond 1991 dynamic panel," Statistical Software Components RTZ00169, Boston College Department of Economics.
- Biswas, Amit K. & Farzanegan, Mohammad Reza & Thum, Marcel, 2012.
"Pollution, shadow economy and corruption: Theory and evidence,"
Elsevier, vol. 75(C), pages 114-125.
- Amit K. Biswas & Mohammad Reza Farzanegan & Marcel Thum, 2011. "Pollution, Shadow Economy and Corruption: Theory and Evidence," CESifo Working Paper Series 3630, CESifo Group Munich.
- 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.
- Arellano, M, 1987. "Computing Robust Standard Errors for Within-Groups Estimators," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 49(4), pages 431-34, November.
- World Bank, 2012. "World Development Indicators 2012," World Bank Publications, The World Bank, number 6014.
When requesting a correction, please mention this item's handle: RePEc:mar:magkse:201419. 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: (Bernd Hayo)
If references are entirely missing, you can add them using this form.