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Contesting Resources - Rent Seeking, Conflict and the Natural Resource Curse

  • Bulte, Erwin
  • Wick, Katharina

A growing empirical literature links natural resource abundance and "pointiness" to impeded economic growth and civil strife. We develop rent seeking and conflict models that capture the most salient features of contests for resource rents, and show how both resource abundance and geographical clustering can be associated with intense contests and sub-optimal economic performance. However, we also show that these relationships are not necessarily monotonous { pointiness can trigger more intense contests but can also facilitate the coordination on peaceful outcomes. Finally we show that contesting resources through violent conflict may yield superior outcomes (from an economy-wide perspective) than contests through rent seeking.

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Paper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Kiel 2005 with number 36.

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Date of creation: 2005
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Handle: RePEc:zbw:gdec05:3509
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  1. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 26-52, February.
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  8. Baye, M.R. & Kovenock, D., 1993. "The Solution to the Tullock Rent-Seeking Game When R > 2: Mixed Strategy Equilibria and Mean Dissipation Rates," Papers 9368, Tilburg - Center for Economic Research.
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  17. Hotte, Louis & Long, Ngo Van & Tian, Huilan, 2000. "International trade with endogenous enforcement of property rights," Journal of Development Economics, Elsevier, vol. 62(1), pages 25-54, June.
  18. Ian Bannon & Paul Collier, 2003. "Natural Resources and Violent Conflict : Options and Actions," World Bank Publications, The World Bank, number 15047.
  19. Torvik, Ragnar, 2002. "Natural resources, rent seeking and welfare," Journal of Development Economics, Elsevier, vol. 67(2), pages 455-470, April.
  20. Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-73, October.
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