The objectives of this thesis are to: (1) examine if the resource curse exists in the context of Libya; (2) assess the role of institutions in avoiding or minimising the resource curse, and; (3) evaluate institutional and economic reforms required, and the best options to diversify the economy from oil, hence avoid the resource curse in Libya. To achieve these, three approaches are applied, (i) a three country comparative analysis; (ii) Libya country-level time-series analysis, and; (iii) institutional descriptive analysis. This thesis uses time-series data and annual datasets covering 1970-2010. Johansen’s co-integration is used to establish the long-run equilibrium relationship among the variables in the models. The Johansen co-integration test, based on the Trace and Maximum Eigenvalue statistics, is applied. In the first approach, the three case studies included in the study are Nigeria, Norway and UAE, with outcomes suggesting that Norway managed to avoid the Dutch disease, the UAE show no major signs of the resource curse, Norway and the UAE have largely managed to overcome Dutch disease, while Nigeria suffers a management curse. The first model suggests that Libya may experience a resource curse, but this may not be as a result of an appreciation of the real exchange rate. A 1% increase in the oil price will cause the Libyan exchange rate to increase (depreciate) by 1.41%. The country could potentially suffer from Dutch disease, but no evidence can be brought by the first model alone. In an attempt to reinforce the first analysis, the second model examined the sectoral impacts of the Dutch disease. Three relations are estimated; tradable sectors (manufacturing and agricultural), and non-tradable sectors (construction and services). These were all found to have been affected by oil revenue. This therefore confirms the existence of Dutch disease in Libya. The descriptive statistics analysis is used alongside five governance indicators: political stability, government effectiveness, and regulatory quality, rule of law and control of corruption. It is concluded that the quality of institutions in Libya affects economic growth negatively. The study holds several implications for policy-makers.

The "resource curse" is a term that refers to a heterogeneous set of theories about why natural resource abundance undermines the path of a political economy. For each type of "curse", we argue that moving from asking "why" to consider "how" and "when" it permits a more refined conceptual and empirical approach to the link between natural resources and social change, be it economic or political development. Specifically, the micro study of actors and institutions in historical context sheds light on areas where aggregate macro statistical study cannot provide. To do this, the critical use of the conceptual frameworks of the new institutionalism in the social sciences enhances the depth of empirical research. The contemporary Peruvian experience shows the variety and variability of economic and political challenges of development based in resources. / La ‘maldición de los recursos’ es un término que refiere a un conjunto heterogéneo de teorías sobre el por qué la abundancia de recursos naturales perjudica la trayectoria de una economía política. Para cada tipo de ‘maldición’, argumentamos que pasar del preguntar ‘por qué’ a examinar ‘cómo’ y ‘cuándo’ permite una más afinada aproximación conceptual y empírica al vínculo entre recursos naturales y cambio social, sea este el desarrollo económico o el político. Concretamente, el microestudio de actores e instituciones en contexto histórico aporta luces en áreas donde el macroestudio de agregados estadísticos no puede aportar. Para ello, el uso crítico de los marcos conceptuales de los nuevos institucionalismos en las Ciencias Sociales potencia la profundidad de la investigación empírica. La experiencia peruana contemporánea muestra la variedad, y variabilidad, de los desafíos económico-políticos del desarrollo basado en recursos.

The literature addressing the resource curse has been extensive. Many studies have put forth theories to explain the curse, but these theories are often refuted by new studies. Recently, there has been a theory that natural resource abundance leads to decreased economic freedom, which causes slower economic growth. Many of these studies have using frequentist testing to arrive at their conclusions. Although frequentist testing is widely used, there are several drawbacks. In particular, there is no way of addressing model uncertainty. Unless a study is able to incorporate every significant explanatory variable, the results will suffer from omitted variable bias. Recently, researchers have been applying Bayesian statistics to address the problem of model uncertainty. In this study, we apply Bayesian Model Averaging (BMA) to build a growth model, and see if natural resources have a negative effect on growth. We take the implementation of BMA a step further to see if there is an indirect negative effect of natural resources on economic freedom. However, contrary to previous studies, we were not able to find a negative relationship between resource abundance and economic freedom.

Sweden is the leading mining country in Europe and the Swedish government intends to retain this position by fostering innovation, investments and cooperation. However, mining is an extractive industry with massive consequences on the surrounding environment and the people living there. In resource abundant northern Sweden mineral extraction is a contested subject, not least in respect to the traditional land use by the Sami population. This study intends to increase the understanding of the current mining trial process in Sweden, the effects on sustainable regional development and the implications for local communities. To do so, this study aims to identify which aspects that are brought forward during the trial for exploitation concession and how different interests are evaluated. For the purpose of this study, the bureaucratic mining trial process is examined and 15 mining cases studied in detail considering the exploitation concession phase. The material indicates that conflicts over the bureaucratic process is based both in what aspects that should be included in the assessment, how these aspects are evaluated and at what stage in the formal process various aspects should be brought up. Guided by the concepts of extractivism and subnational resource curse, the main finding identified is that the mining trial process is state-centred. This is displayed in the limited influence of local actors on the decision and in the use of national interest as a policy tool to evaluate conflicting land use claims. These characteristics can in turn increase the risk of a subnational resource curse in northern Sweden.

The resource ‘curse’ is premised on an inverse relationship between mineral wealth and economic growth. The declamation pertaining to the reasons for, and exceptions to, the resource ‘curse’ remains inconclusive. MNCs are cited amongst the reasons for the resource ‘curse’, particularly in developing economies. However, Africa (and the role of MNCs) remains underrepresented in resource ‘curse’ literature. In light of this, the study’s aim is to determine how MNCs in Mozambique’s gas sector could be considered a causal channel of the resource ‘curse’, as the contest for relatively untapped natural gas reserves in Mozambique is intensifying. An exploratory case study is provided, where Phase I consisted of 11 qualitative interviews with 14 oil and gas experts while Phase II analysed secondary data in the form of public documents and audio-visual materials, intended to supplement and verify the interview data. The results reveal that MNCs (i) promote and prioritize their CSR initiatives to mask their inability (or unwillingness) to adhere to local content directives and (ii) leverage the diplomatic relationships of their home country government to supersede the host country’s sovereignty. Moreover, the Mozambican government’s cultural practices exacerbated the prospects of a resource ‘curse’ outcome. The study concludes that the MNC, in the case of Africa, in particular Mozambique and Angola, is indeed a channel of the resource ‘curse’. / Mini Dissertation (MPhil)--University of Pretoria, 2019. / Gordon Institute of Business Science (GIBS) / MPhil (International Business) / Unrestricted

To establish the economic impact of petroleum in the UK, this paper uses the synthetic control method. By constructing an artificial UK economy without oil, from the donor pool of OECD economies, it establishes the counterfactual time path of capital stock the UK would have had if it lacked the petroleum endowment. Comparing the observed time path of capital stock with its counterfactual, one can witness that the petroleum extraction has reduced the UK’s capital stock with an average of 17 % since 1970, despite the UK having arguably the best quality of institutions. Dose-response tests suggest that it is possible to attribute the impact to the petroleum production. Performed robustness and sensitivity tests together with several falsification tests show that the result is robust to alternations in the donor pool, the predictor variables and alternative explanations. The finding raises a question regarding the quality of institutions, advanced by Mehlum, Moene and Torvik and claimed that the resource curse only occurs in economies with low quality of institutions.

The natural resource curse is a widely debated phenomenon usually proposing a connection between large extractive resource wealth and substandard economic performance. This paper concerns the connection between large extractive resource wealth and the potential for its effects on long term political stability. Using Venezuela as a case study, this paper delves into the political history of Venezuela, plagued by endemic political instability, and attempts to test the political aspect of the resource curse, analysing history with a focus on the oil industry. The conclusion is that there is a clear connection between oil price volatility and political instability, but only evident starting in the latter half of the 20th -century. Further research into specific regimes, eras, as well as comparative analyses between Venezuela and other states is required to provide additional answers in regard to specific causes for political instability in the early 20th -century and the pre-oil period.

M.A., Faculty of Humanties, University of the Witwarersrand, 2011 / The preponderance of intrastate violent conflicts in natural resource rich states has been attributed to a number of causal mechanisms. Theorists of conflicts thus tend to explain these conflicts using different approaches, notably path dependency and rational choice. These approaches examine issues such as ethnicity and political marginalization, weak but repressive state capacity, strategic dilemmas, foreign instigators of conflict, and the very pervasive theory of the resource curse. Natural resources usually lie at the heart of many of these conflicts and the resource curse theory has helped explain the effects of states’ dependence on the primary resource sector. This resource curse is therefore corroborated by the rational choice approach which insists that economic incentives explain the upsurge in rebellious activities within natural resource rich but poor and dependent states, especially in Africa. This research interrogates the rational choice approach of Collier and Hoeffler against the backdrop of issues in the Niger Delta conflict. It argues that the greed versus grievance theory remains inadequate in the light of the historical and sociological circumstances underlying political struggles in the region. The research report concludes that an integrated but eclectic approach be applied in the study of this crisis.

The resource curse, also known as the “paradox of plenty”, basically states that countries that have natural resources in abundance, particularly in terms of non-renewable resources such as oil and gas and minerals, in the long run tend to have less economic growth and prosperity, than countries with relatively lesser endowments of natural resources. This research investigates the case of the Chilean economy; its erstwhile saltpeter mining industry and current copper mining industry. The study attempts to answer the research question of whether Chile is still under the resource curse. Through the facts of the case study, semi-structured formal and informal interviews and extensive literature review, the researcher identified four main outcomes of the resource curse which are true to the Chilean history and current events; plundering of national wealth by political leaders, weak policy enforcements and military challenges to the government and the subsequent threats to the country’s democracy. The results of the case study suggest that, Chile is indeed still under the resource curse. The researcher draws on economic theory by Joseph Schumpeter in his most celebrated publication, “The theory of Economic Development” to gain understanding into the Chilean reality of economic under development and any other possible factors besides the resource curse, mainly lack of entrepreneurial ambitions by the human capital of the economy. The study contrasts, Schumpeter’s economic theory to Marxist economic theory of total control of nation states’ resources by governments and the Keynesian economic theory of government intervention aimed at supporting growth.

Bakgrund: Resursförbannelsen innebär att det finns ett negativt samband mellan mängden naturtillgångar och ekonomisk tillväxt. På grund av detta är det få resursrika länder som nått sin fulla potential. Tidigare forskning har mestadels bestått av ekonometriska modeller som bevisar detta negativa samband mellan naturresurser och ekonomisk tillväxt, vilket motiverat oss till att genomföra en kvalitativ analys.  Syfte: Syftet med denna uppsats är att genom en jämförelse av två likvärdiga länder analysera och förklara varför DR Kongo drabbats av resursförbannelsen medan Botswana undkom den. Uppsatsen syftar vidare till att jämföra utifrån tre ekonomiska teorier: holländska sjukan, rent seeking samt institutionell teori. Metod: För att uppnå syftet med uppsatsen används en komparativ metod. Länderna har valts utifrån deras likheter då både Botswana och DR Kongo befinner sig i Sub-Sahara Afrika, har en historia av kolonisering och är rika på mineraler. Metoden är lämplig vid jämförelse av länder. Därför är metoden motiverad att använda när vi jämför hur ett överflöd av naturresurser påverkar Botswanas och DR Kongos ekonomiska utveckling.  Slutsats: De i uppsatsen framkomna bevisen tyder på att DR Kongo har drabbats av resursförbannelsen eftersom vi kan se att holländska sjukan, rent seeking och svaga institutioner förekommer i landet. Alla dessa faktorer bidrar till resursförbannelsen. Till skillnad från Botswana som varken har drabbats av holländska sjukan eller rent seeking. Botswana har även haft stabila institutioner under lång tid. Slutsatsen vi drar är att institutioner är den viktigaste faktorn när det kommer till hur ett land kan undvika resursförbannelsen. / Background: The Resource Curse implies that there is a negative relation between the amount of natural resources and economic growth. Because of this few resource rich countries have reached their full potential. Previous research has mostly consisted of econometric models that prove this negative relation, which has pursued us to conduct a qualitative analysis.  Purpose: The purpose of this bachelor thesis is to compare two equivalent countries to analyze and explain why DR Congo has suffered from the Resource Curse while Botswana escaped it. The thesis further aims to compare based on three economic theories: Dutch disease, rent seeking and institutional theory.  Method: To achieve the purpose a comparative method is used. The countries have been chosen based on their similarities. Both Botswana and DR Congo are located in Sub-Saharan Africa, have a history of colonization and are rich in minerals. This method is appropriate for comparison of countries. Therefore this method is motivated to use when we compare how an abundance of natural resources affect Botswana’s and DR Congo’s economic growth.  Conclusion: The results from the thesis imply that DR Congo has suffered from the Resource Curse since Dutch disease, rent seeking and weak institutions exist in the country. All of these factors contribute to the Resource Curse. In comparison to Botswana who has not suffered from Dutch disease or rent seeking. Botswana has had strong institutions for a long time. Our conclusion is that institutions are the main element when it comes to escaping the Resource Curse.