A Dual-Track Strategy for Managing Mauritania's Projected Oil Rent

19 Pages Posted: 11 Dec 2007

See all articles by Richard M. Auty

Richard M. Auty

Lancaster University - Geography

Nicola Pontara

World Bank

Abstract

High rent creates contests for its capture that, unless skilfully managed, degrade political institutions and distort the economy, leading to a collapse of growth if unreformed. Mauritania's projected oil stream risks such an outcome because past rent-driven growth has left a legacy of Dutch disease effects, rent-seeking and dependent social capital. This article proposes a dual-track strategy for deploying the oil rent as a politically practical means of managing social tensions and improving the economic outcome. Track one promotes a dynamic market economy in the hitherto neglected rural areas, while track two gradually reforms the rent-driven urban sector, thus postponing confrontation with established rent-seekers while the dynamic sector drives competitive diversification of the economy and builds a pro-reform political constituency.

Suggested Citation

Auty, Richard M. and Pontara, Nicola, A Dual-Track Strategy for Managing Mauritania's Projected Oil Rent. Development Policy Review, Vol. 26, No. 1, pp. 59-77, January 2008. Available at SSRN: https://ssrn.com/abstract=1067743 or http://dx.doi.org/10.1111/j.1467-7679.2008.00398.x

Richard M. Auty (Contact Author)

Lancaster University - Geography ( email )

Lancaster Environment Centre
Lancaster University
Lancaster, LA1 4YB
United Kingdom

Nicola Pontara

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

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