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Natural resources and the tradeoff between authoritarianism and development

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  • Al-Ubaydli, Omar

Abstract

Why do African and Middle Eastern countries seem cursed by an abundance of natural resources yet USA, Australia and Norway seem blessed? A growing literature has argued that the benevolence or malignance of natural resources depends upon the quality of institutions. This paper offers a new explanation based on associational freedom and its interaction with the political system. The model predicts that natural resources have an adverse impact on economic performance and transition to democracy in authoritarian regimes but not in democracies. It also predicts that repression of associational freedom will be increasing in natural resources in authoritarian regimes. I test the model's predictions using fixed-effects regressions on an international panel from 1975 to 2000 and find support.

Suggested Citation

  • Al-Ubaydli, Omar, 2012. "Natural resources and the tradeoff between authoritarianism and development," Journal of Economic Behavior & Organization, Elsevier, vol. 81(1), pages 137-152.
    • Handle: RePEc:eee:jeborg:v:81:y:2012:i:1:p:137-152
    DOI: 10.1016/j.jebo.2011.09.009
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    More about this item

    Keywords

    Development; Natural resources; Authoritarianism; Democratization;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • D7 - Microeconomics - - Analysis of Collective Decision-Making

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