IDEAS home Printed from https://ideas.repec.org/a/spr/minecn/v30y2017i2d10.1007_s13563-016-0097-0.html
   My bibliography  Save this article

Linkages between mining and non-mining sectors in Botswana

Author

Listed:
  • Kegomoditswe Koitsiwe

    (Akita University)

  • Tsuyoshi Adachi

    (Akita University
    Akita University)

Abstract

Over the past decades, a negative view of mining has emerged questioning the positive relationship between mineral extraction and economic development with particular attention to developing countries. The debate remains unresolved as mining continues to be an enclave sector in many resource-rich developing countries. In this paper, we examine the linkage between mining and non-mining sectors in the economy of Botswana using time series data from 1976 to 2014. The study adopted statistical tests including the Granger causality test and vector autoregressive (VAR) technique based upon the impulse response function (IRF) and variance decomposition (VD) to observe linkages among variables. The empirical results show a significant causal linkage from mining to manufacturing and services. Our findings are consistent with respect to the statistical tests used. Overall, the results indicate that there is a forward linkage between mining and manufacturing and mining and service sector. The policy implication of the study is that the government of Botswana should consider the development of backward linkage from mining sector such as provision of mining inputs and services by local companies.

Suggested Citation

  • Kegomoditswe Koitsiwe & Tsuyoshi Adachi, 2017. "Linkages between mining and non-mining sectors in Botswana," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 30(2), pages 95-105, July.
    • Handle: RePEc:spr:minecn:v:30:y:2017:i:2:d:10.1007_s13563-016-0097-0
    DOI: 10.1007/s13563-016-0097-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s13563-016-0097-0
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s13563-016-0097-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Teka, Zeferino, 2012. "Linkages to manufacturing in the resource sector: The case of the Angolan oil and gas industry," Resources Policy, Elsevier, vol. 37(4), pages 461-467.
    2. Venus Khim-Sen Liew, 2004. "Which Lag Length Selection Criteria Should We Employ?," Economics Bulletin, AccessEcon, vol. 3(33), pages 1-9.
    3. Venables, Anthony J. & Maloney, William & Kokko, Ari & Bravo Ortega, Claudio & Lederman, Daniel & Rigobón, Roberto & De Gregorio, José & Czelusta, Jesse & Jayasuriya, Shamila A. & Blomström, Magnus & , 2007. "Natural Resources: Neither Curse nor Destiny," IDB Publications (Books), Inter-American Development Bank, number 350, December.
    4. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    5. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
    6. Pegg, Scott, 2010. "Is there a Dutch disease in Botswana?," Resources Policy, Elsevier, vol. 35(1), pages 14-19, March.
    7. Sims, Christopher A, 1980. "Macroeconomics and Reality," Econometrica, Econometric Society, vol. 48(1), pages 1-48, January.
    8. Morris, Mike & Kaplinsky, Raphael & Kaplan, David, 2012. "“One thing leads to another”—Commodities, linkages and industrial development," Resources Policy, Elsevier, vol. 37(4), pages 408-416.
    9. repec:idb:brikps:59538 is not listed on IDEAS
    10. Daniel Lederman & William F. Maloney, 2007. "Natural Resources : Neither Curse nor Destiny," World Bank Publications, The World Bank, number 7183, September.
      • Anthony J. Venables & William Maloney & Ari Kokko & Claudio Bravo Ortega & Daniel Lederman & Roberto Rigobón & José De Gregorio & Jesse Czelusta & Shamila A. Jayasuriya & Magnus Blomström & L. Colin X, 2007. "Natural Resources: Neither Curse nor Destiny," IDB Publications (Books), Inter-American Development Bank, number 59538 edited by William Maloney & Daniel Lederman, February.
    11. David de Ferranti & Guillermo E. Perry & Daniel Lederman & William E. Maloney, 2002. "From Natural Resources to the Knowledge Economy : Trade and Job Quality," World Bank Publications - Books, The World Bank Group, number 14040.
    12. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-380, November.
    13. Adedeji, Abdulkabir Niran & Sidique, Shaufique Fahmi & Rahman, Azmawani Abd & Law, Siong Hook, 2016. "The role of local content policy in local value creation in Nigeria's oil industry: A structural equation modeling (SEM) approach," Resources Policy, Elsevier, vol. 49(C), pages 61-73.
    14. Aroca, Patricio, 2001. "Impacts and development in local economies based on mining: : the case of the Chilean II region," Resources Policy, Elsevier, vol. 27(2), pages 119-134, June.
    15. Mr. Atsushi Iimi, 2006. "Did Botswana Escape from the Resource Curse?," IMF Working Papers 2006/138, International Monetary Fund.
    16. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-438, July.
    17. Clements, Kenneth W. & Johnson, Peter L., 2000. "The minerals industry and employment in Western Australia: assessing its impacts in federal electorates," Resources Policy, Elsevier, vol. 26(2), pages 77-89, June.
    18. Ahammad, Helal & Clements, Kenneth W., 1999. "What does minerals growth mean to Western Australia?," Resources Policy, Elsevier, vol. 25(1), pages 1-14, March.
    19. Adewuyi, Adeolu O. & Ademola Oyejide, T., 2012. "Determinants of backward linkages of oil and gas industry in the Nigerian economy," Resources Policy, Elsevier, vol. 37(4), pages 452-460.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mia Ellis & Margaret McMillan, 2018. "Optimal local content for extractive industries: How can policies best create benefits for Tanzania?," WIDER Working Paper Series wp-2018-133, World Institute for Development Economic Research (UNU-WIDER).
    2. Elkhan Richard Sadik-Zada & Wilhelm Loewenstein & Yadulla Hasanli, 2021. "Production linkages and dynamic fiscal employment effects of the extractive industries: input-output and nonlinear ARDL analyses of Azerbaijani economy," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 34(1), pages 3-18, April.
    3. Mia Ellis & Margaret McMillan, 2018. "Optimal local content for extractive industries: How can policies best create benefits for Tanzania?," WIDER Working Paper Series 133, World Institute for Development Economic Research (UNU-WIDER).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jeffrey Frankel, 2012. "The Natural Resource Curse: A Survey of Diagnoses and Some Prescriptions," Growth Lab Working Papers 36, Harvard's Growth Lab.
    2. Weldegiorgis, Fitsum S. & Dietsche, Evelyn & Franks, Daniel M., 2021. "Building mining's economic linkages: A critical review of local content policy theory," Resources Policy, Elsevier, vol. 74(C).
    3. Graham A. Davis & John E. Tilton, 2005. "The resource curse," Natural Resources Forum, Blackwell Publishing, vol. 29(3), pages 233-242, August.
    4. Shahbaz, Muhammad & Ahmed, Khalid & Tiwari, Aviral Kumar & Jiao, Zhilun, 2019. "Resource curse hypothesis and role of oil prices in USA," Resources Policy, Elsevier, vol. 64(C).
    5. Kaznacheev, Peter, 2013. "Resource Rents and Economic Growth: Economic and institutional development in countries with a high share of income from the sale of natural resources. Analysis and recommendations based on internatio," EconStor Research Reports 121950, ZBW - Leibniz Information Centre for Economics.
    6. Badeeb, Ramez Abubakr & Lean, Hooi Hooi & Clark, Jeremy, 2017. "The evolution of the natural resource curse thesis: A critical literature survey," Resources Policy, Elsevier, vol. 51(C), pages 123-134.
    7. Ben-Salha, Ousama & Dachraoui, Hajer & Sebri, Maamar, 2021. "Natural resource rents and economic growth in the top resource-abundant countries: A PMG estimation," Resources Policy, Elsevier, vol. 74(C).
    8. Santos, Carlos Filipe & Fuinhas, José Alberto & Marques, António Cardoso, 2014. "O nexus energia-crescimento e o nível da auto-suficiência na produção de petróleo: análise com macro painel [Energy-growth nexus and oil self-sufficiency: macro panel analysis]," MPRA Paper 57008, University Library of Munich, Germany.
    9. Maconachie, Roy & Binns, Tony, 2007. "Beyond the resource curse? Diamond mining, development and post-conflict reconstruction in Sierra Leone," Resources Policy, Elsevier, vol. 32(3), pages 104-115, September.
    10. Boire, Sidiki & Nell, Kevin S., 2021. "The enclave hypothesis and Dutch disease effect: A critical appraisal of Mali's gold mining industry," Resources Policy, Elsevier, vol. 74(C).
    11. Frankel, Jeffrey A., 2010. "The Natural Resource Curse: A Survey," Scholarly Articles 4454156, Harvard Kennedy School of Government.
    12. Ali, Adnan & Ramakrishnan, Suresh & Faisal,, 2022. "Financial development and natural resources. Is there a stock market resource curse?," Resources Policy, Elsevier, vol. 75(C).
    13. repec:ocp:rpaper:rp-0524 is not listed on IDEAS
    14. Jason A. Hubbart & Hodjat Ghadimi, 2023. "Regional Wealth Data Acquisition and Modeling: Innovations Needed for Advancement in Sustainable Wealth in Energy-Rich Regions," Challenges, MDPI, vol. 14(4), pages 1-17, December.
    15. Adrian Boos & Karin Holm‐Müller, 2012. "A theoretical overview of the relationship between the resource curse and genuine savings as an indicator for “weak” sustainability," Natural Resources Forum, Blackwell Publishing, vol. 36(3), pages 145-159, August.
    16. Ghamsi Deffo, Salomon Leroy & Adjoumessi Houmpe, Donald & Dasi Yemkwa, Gyslin Hermann, 2020. "Contribution du Capital Humain dans transmission des effets de l’abondance en ressources naturelles au développement économique des pays de la CEMAC [Contribution of Human Capital in transmitting t," MPRA Paper 104492, University Library of Munich, Germany.
    17. Thorvaldur Gylfason & Gylfi Zoega, 2017. "The Dutch Disease in Reverse: Iceland's Natural Experiment," CESifo Working Paper Series 6513, CESifo.
    18. Castaño, Andrés & Lufin, Marcelo & Atienza, Miguel, 2019. "A structural path analysis of Chilean mining linkages between 1995 and 2011. What are the channels through which extractive activity affects the economy?," Resources Policy, Elsevier, vol. 60(C), pages 106-117.
    19. Steve Bond & Stephen R. Bond & Adeel Malik, 2008. "Natural resources, export structure and investment," Economics Series Working Papers CSAE WPS/2008-20, University of Oxford, Department of Economics.
    20. Maria Savona & Filippo Bontadini, 2023. "Revisiting the Natural Resource Curse: Backward Linkages for Export Diversification and Structural Economic Transformation," Development and Change, International Institute of Social Studies, vol. 54(2), pages 378-421, March.
    21. Chandra, Vandana & Osorio Rodarte, Israel, 2009. "Options for Income-Enhancing Diversification in Burkina Faso," MPRA Paper 20928, University Library of Munich, Germany.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:minecn:v:30:y:2017:i:2:d:10.1007_s13563-016-0097-0. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.