The Resource Curse Hypothesis and its Transmission Channels

Posted: 13 Oct 2004

See all articles by Elissaios Papyrakis

Elissaios Papyrakis

VU University Amsterdam - Institute for Environmental Studies (IVM)

Reyer Gerlagh

Tilburg University - Tilburg University School of Economics and Management

Abstract

We examine empirically the direct and indirect effects of natural resource abundance on economic growth. Natural resources have a negative impact on growth if considered in isolation, but a positive direct impact on growth if other explanatory variables, such as corruption, investment, openness, terms of trade, and schooling, are included. We study the transmission channels, that is, the effect of natural resources on the other explanatory variables, and calculate the indirect effect of natural resources on growth for each transmission channel. The negative indirect effects of natural resources on growth are shown to outweigh the positive direct effect by a reasonable order of magnitude.

Keywords: Natural resources, Growth, Transmission channels

JEL Classification: C21, O13, Q33

Suggested Citation

Papyrakis, Elissaios and Gerlagh, Reyer, The Resource Curse Hypothesis and its Transmission Channels. Journal of Comparative Economics, Vol. 32, No. 1, pp. 1-196, 2004. Available at SSRN: https://ssrn.com/abstract=603062

Elissaios Papyrakis (Contact Author)

VU University Amsterdam - Institute for Environmental Studies (IVM) ( email )

De Boelelaan 1115
Amsterdam, 1081 HV
Netherlands
+31 20 44 49502 (Phone)
+31 20 44 49553 (Fax)

Reyer Gerlagh

Tilburg University - Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

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