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Does the ‘Resource Curse’ hold for Growth in Genuine Income as well?

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  • Eric Neumayer

Abstract

Existing studies analyzing the so-called ‘resource curse’ hypothesis regress growth in gross domestic product (GDP) on some measure of resource-intensity. This is problematic as GDP counts natural and other capital depreciation as income. Deducting depreciation from GDP to arrive at genuine income, we test whether the ‘curse’ still holds true. We find supporting evidence, but the growth disadvantage of resource- intensive economies is slightly weaker in terms of genuine income than GDP. We suggest that this provides additional, but somewhat weak and limited, evidence in support of those who argue that the ‘curse’ is partly due to unsustainable over-consumption.

Suggested Citation

  • Eric Neumayer, 2003. "Does the ‘Resource Curse’ hold for Growth in Genuine Income as well?," Others 0312002, University Library of Munich, Germany, revised 18 May 2004.
  • Handle: RePEc:wpa:wuwpot:0312002
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    More about this item

    Keywords

    resource curse hypothesis; natural capital; depreciation; genuine income;
    All these keywords.

    JEL classification:

    • P - Economic Systems
    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
    • Z - Other Special Topics

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