Download this Paper Open PDF in Browser

The Geography of Natural Resources, Ethnic Inequality and Development

56 Pages Posted: 15 Feb 2017  

Christian Lessmann

Technology University of Braunschweig; Ifo Branch Dresden; CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Arne Steinkraus

Institute of Economics

Date Written: January 24, 2017

Abstract

We study whether the spatial distribution of natural resources across different ethnic groups within countries impede spatial inequality, national economic performance, and the incidence of armed conflict. By providing a theoretical rent-seeking model and analysing a set of geocoded data for mines, night-time light emissions, local populations and ethnic homelands, we show that the distribution of resources is a major driving factor of ethnic income inequality and, thus, induces rent-seeking behaviour. Consequently, we extend the perspective of the resource curse to explain cross-country differences in economic performance and the onset of civil conflicts. We show that the inequality in the spatial distribution of resource endowments within countries drives the curse of natural resources, not the resources per se.

Keywords: natural resources, minerals, mines, night lights, luminosity, ethnic income inequality, spatial inequality, development, civil war, conflict

JEL Classification: D720, D740, Q320, Q340

Suggested Citation

Lessmann, Christian and Steinkraus, Arne, The Geography of Natural Resources, Ethnic Inequality and Development (January 24, 2017). CESifo Working Paper Series No. 6299. Available at SSRN: https://ssrn.com/abstract=2917209

Christian Lessmann (Contact Author)

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

Technology University of Braunschweig ( email )

Abt-Jerusalem-Str. 7
Braunschweig, D-38106
Germany

Ifo Branch Dresden ( email )

Poschinger Str. 5
Munich, 01069
Germany

Arne Steinkraus

Institute of Economics ( email )

Abt-Jerusalem-Str. 7
Braunschweig, D-38106
Germany

HOME PAGE: http://https://www.tu-braunschweig.de/vwl

Paper statistics

Downloads
64
Rank
295,436
Abstract Views
213