scholarly journals Institutions and the “Resource Curse”: Evidence From Cases of Oil-Related Bribery

2019 ◽  
Vol 53 (1) ◽  
pp. 3-39 ◽  
Author(s):  
Paasha Mahdavi
Keyword(s):  
Instrumental Variables ◽  
Resource Curse ◽  
Resource Extraction ◽  
Regulatory Environment ◽  
The Political ◽  
Institutional Choice ◽  
Political Autonomy ◽  
Show Evidence ◽  
Rich Countries ◽  
Institutional Choices

While some resource-rich countries are highly corrupt, others have transparent and well-functioning governments. What explains this wide variation in so-called “resource-cursed” states? I show that these differences result from domestic institutional choices over how resource extraction is governed. Some governments grant procurement authority—the ability to award contracts for production rights—to state-owned enterprises, whereas others place this authority in ministries. Building upon agency theory, I argue that this choice matters: The relative political autonomy of state-owned enterprises compared with ministries fosters an opaque regulatory environment that incentivizes malfeasance. Using new data on transnational bribes in 59 oil-producing countries, I show evidence for a robust link between oil-related institutions and bribery, even after addressing the endogeneity of institutional choice via instrumental variables analysis. This research has implications not only for the political economy of the resource curse hypothesis but also for existing theories on corruption and regulatory independence.

Toward an Alternative Explanation for the Resource Curse: Natural Resources, Immigration, and Democratization

2011 ◽  
Vol 44 (6) ◽  
pp. 689-718 ◽  
Author(s):  
David H. Bearce ◽  
Jennifer A. Laks Hutnick
Keyword(s):  
Alternative Explanation ◽  
Causal Effect ◽  
Negative Relationship ◽  
Resource Curse ◽  
The Political ◽  
Significant Negative Relationship ◽  
Political Resource ◽  
Per Capita ◽  
Per Se ◽  
Rich Countries

Why do many resource-rich countries maintain autocratic political regimes? The authors’ proposed answer focuses on the causal effect of labor imports, or immigration. Using the logic offered by Acemoglu and Robinson’s democratization model, the authors posit that immigration makes democratization less likely because it facilitates redistributive concessions to appease the population within an autocratic regime. This immigration argument applies directly to the political resource curse since many resource-rich countries tend to also be labor scarce, leading them to import foreign laborers. Consistent with this understanding, the authors find a statistically significant negative relationship between net immigration per capita and democratization in future periods. Their results also show that when controlling for this immigration effect, the standard resource curse variables lose significance in a democratization model. This latter result suggests that much of the so-called resource curse stems not from resource endowments per se but rather from the labor imports related to resource production.

scholarly journals Independence of Central Banks in Commodity Economies

2016 ◽  
pp. 6-25 ◽  
Author(s):  
Viktor Koziuk
Keyword(s):  
Resource Curse ◽  
Central Banks ◽  
Political Regime ◽  
The Political ◽  
General Tendency ◽  
Low Degree ◽  
Multivariable Regression ◽  
Rich Countries ◽  
The Impact

This article introduces the hypothesis that resource-rich countries display a low degree of central bank independence (CBI). This hypothesis is proven based on multivariable regression, but the influence of resource factors is not considered strong enough compared with previous inflationary experience and the characteristics of the political regime. It stresses that the impact of the commodity wealth factor on CBI choice is direct (through the share of commodity exports in total export) and indirect through the lower level of democracy in commodities countries that feature more dependent central banks. Also, this hypothesis is proven based on the grouping of countries. Such grouping shows that despite a general tendency of CBI increase in the world, a group of commodity exporting countries experiencing a substantially lower level of mean GMT-index, ECWN-index, and transparency-index resulted in lower CBI compared with groups of emerging markets and developing countries. Explaining these phenomena is rooted in features of institutional distortions in commodity economies, the specific structure of interventionist policy to overcome a "resource curse", and the specific role of the exchange rate and FX reserves in intertemporal macroeconomic policy.

Resource Extraction and Inclusive Development

2018 ◽  
Author(s):  
Anthony Bebbington ◽  
Abdul-Gafaru Abdulai ◽  
Denise Humphreys Bebbington ◽  
Marja Hinfelaar ◽  
Cynthia A. Sanborn ◽  
...  
Keyword(s):  
Natural Resources ◽  
Comparative Research ◽  
Resource Curse ◽  
Inclusive Development ◽  
Resource Extraction ◽  
The Political ◽  
Extractive Industry ◽  
Resource Governance ◽  
Political Implications ◽  
Cross Country

This chapter develops a conceptual framework for understanding the politics of extractive industry governance. Building from the work of Karl, Ross, Watts, and others, and their efforts to understand the political drivers and consequences of the resource curse, the chapter proposes an approach that also engages with political settlements theory, addressing the political implications of the materiality of natural resources and the politics of ideas surrounding resource governance. The chapter then introduces a programme of cross-country, comparative research designed to address the relationships among political settlements, extractive industry, and patterns of development; describes the questions that guided this research; and presents the methods used.

scholarly journals Angola

2020 ◽  
pp. 283-304
Author(s):  
Rebecca Engebretsen ◽  
Ricardo Soares de Oliveira
Keyword(s):  
Financial Market ◽  
Banking Sector ◽  
Oil Prices ◽  
Balance Of Payments ◽  
International Standards ◽  
Regulatory Environment ◽  
The Political ◽  
Financial Flows ◽  
Bank Regulation And Supervision ◽  
Rich Countries

As in other resource-rich countries, the financial sector in Angola plays a key role in facilitating outgoing financial flows. The political allocation of credit and issuing of bank licenses to insiders have been an important avenue for securing support for the regime. The result has been strong opposition to the ratcheting-up of bank regulation and supervision. Yet a balance-of-payments crisis in 2009, falling in oil prices from 2014, and changes in the global regulatory environment together meant that divergence from international standards was no longer an option. For Angolan banks to maintain their links to the global financial market, the country needed to signal its readiness to regulate the sector in line with international standards. Nonetheless, because the politicized nature of the banking sector has not changed, standards are either not implemented or are implemented but not enforced, leading to a situation of ‘mock compliance’.

Mechanisms of Resource Curse and Economic Policy

2007 ◽  
pp. 4-27 ◽  
Author(s):  
V. Polterovich ◽  
V. Popov ◽  
A. Tonis
Keyword(s):  
Real Exchange Rates ◽  
Resource Curse ◽  
Budget Deficits ◽  
Resource Abundance ◽  
Fuel Prices ◽  
Use Of Resources ◽  
Resource Wealth ◽  
The One ◽  
The Right ◽  
Rich Countries

This paper compares various mechanisms of resource curse leading to a potentially inefficient use of resources; it is demonstrated that each of these mechanisms is associated with market imperfections and can be "corrected" with appropriate government policies. Empirical evidence seems to suggest that resource abundant countries have on average lower budget deficits and inflation, and higher foreign exchange reserves. Besides, lower domestic fuel prices that are typical for resource rich countries have a positive effect on long-term growth even though they are associated with losses resulting from higher energy consumption. On top of that resource abundance allows to reduce income inequalities. So, on the one hand, resource wealth turns out to be conducive to growth, especially in countries with strong institutions. However, on the other hand, resource abundance leads to corruption of institutions and to overvalued real exchange rates. On balance, there is no solid evidence that resource abundant countries grow more slowly than the others, but there is evidence that they grow more slowly than could have grown with the right policies and institutions.

Popular Resource Sovereignty

2018 ◽  
Author(s):  
Leif Wenar
Keyword(s):  
Human Rights ◽  
Natural Resources ◽  
Large Scale ◽  
Good Reason ◽  
Resource Curse ◽  
Civil Conflict ◽  
Popular Sovereignty ◽  
State Sovereignty ◽  
The People ◽  
Rich Countries

Article 1 of both of the major human rights covenants declares that the people of each country “shall freely dispose of their natural wealth and resources.” This chapter considers what conditions would have to hold for the people of a country to exercise this right—and why public accountability over natural resources is the only realistic solution to the “resource curse,” which makes resource-rich countries more prone to authoritarianism, civil conflict, and large-scale corruption. It also discusses why cosmopolitans, who have often been highly critical of prerogatives of state sovereignty, have good reason to endorse popular sovereignty over natural resources. Those who hope for more cosmopolitan institutions should see strengthening popular resource sovereignty as the most responsible path to achieving their own goals.

Bossa Mundo

2019 ◽  
Author(s):  
K.E. Goldschmitt
Keyword(s):  
Local Governments ◽  
Film Music ◽  
The United States ◽  
The Political ◽  
National Brand ◽  
Brazilian Music ◽  
Media Environment ◽  
The United Kingdom ◽  
The Media ◽  
Rich Countries

Bossa Mundo chronicles how Brazilian music has been central to Brazil’s national brand in the United States and the United Kingdom since the late 1950s. Scholarly texts on Brazilian popular music generally focus on questions of music and national identity, and when they discuss the music’s international popularity, they keep the artists, recordings, and live performances as the focus, ignoring the process of transnational mediation. This book fills a major gap in Brazilian music studies by analyzing the consequences of moments when Brazilian music was popular in Anglophone markets, with a focus on the media industries. With subject matter as varied as jazz, film music, dance fads, DJ/remix culture, and new models of musical distribution, the book demonstrates how the mediation of Brazilian music in an increasingly crowded transnational marketplace has had lasting consequences for the creative output celebrated by Brazil as part of its national brand. Through a discussion of the political meaning of mass-mediated music in chronologically organized chapters, the book shifts the scholarly focus on the music’s transnational popularity from the scholarly framework of representing Otherness to broader considerations of a media environment where listeners and intermediaries often have differing priorities. The book provides a new model for studying music from culturally rich countries in the Global South where local governments often leverage stereotypes in their national branding project.

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