Does Oil Hinder Democratic Development? A Time-Series Analysis
33 Pages Posted: 24 Mar 2016
Date Written: March 23, 2016
The resource curse is a topic studied intensively in both economics and political science. Much of the focus is now on whether oil affects democratic institutions. We further the debate through the use of additional measures of democracy and multiple time-series estimation strategies. We find no robust long-run effect of oil rents per capita on Polity, Civil Liberties, or Political Rights. Many comparable studies were restricted to Polity. We also use different country and period samples to respond to the findings that the effects of oil abundance may differ in Latin America, the Middle East, in mature oil producers, or that the effects become significantly negative post-1980. In each case we do not find a significant relationship. Long-run effects are well placed to address this question because they are estimated separately from short-run fluctuations (important given the slow pace of institutional change), and are consistent even in the presence of reverse causality.
Keywords: resource curse, democracy, oil, natural resources, long-run relationships
JEL Classification: O13, P16, H11, P59; O11
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