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Resource rents, coercion, and local development : evidence from post-apartheid South Africa

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  • Bastos,Paulo S. R.
  • Bottan,Nicolas Luis
  • Bastos,Paulo S. R.
  • Bottan,Nicolas Luis

Abstract

This paper examines how the dismantling of coercive institutions associated with the end of apartheid in South Africa in 1994 affected the distribution of rents from natural resource exports. It identifies the interplay between coercive institutions and natural resource rents as an important driver of local development. Using data from the 1996 census, the paper documents large income gaps between communities located just-inside and just-outside the former self-governing territories set aside for black inhabitants. Examining relative changes between 1996 and 2011, the paper finds that spatial income convergence was considerably stronger among marginalized communities with higher initial exposure to resource rents. These results accord with standard bargaining theory in which the dismantling of coercive institutions improves the negotiating position of unionized workers in the mining industry.

Suggested Citation

  • Bastos,Paulo S. R. & Bottan,Nicolas Luis & Bastos,Paulo S. R. & Bottan,Nicolas Luis, 2016. "Resource rents, coercion, and local development : evidence from post-apartheid South Africa," Policy Research Working Paper Series 7572, The World Bank.
  • Handle: RePEc:wbk:wbrwps:7572
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    References listed on IDEAS

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    Cited by:

    1. Bastos, Paulo & Silva, Joana, 2010. "The quality of a firm's exports: Where you export to matters," Journal of International Economics, Elsevier, vol. 82(2), pages 99-111, November.
    2. Paulo Bastos & Joana Silva & Eric Verhoogen, 2018. "Export Destinations and Input Prices," American Economic Review, American Economic Association, vol. 108(2), pages 353-392, February.
    3. Falvey, Rod & Greenaway, David & Silva, Joana, 2010. "Trade liberalisation and human capital adjustment," Journal of International Economics, Elsevier, vol. 81(2), pages 230-239, July.

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    Keywords

    Mining&Extractive Industry (Non-Energy); Rural Labor Markets; Labor Markets; Labor&Employment Law;

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