Resource information
What are the socioeconomic impacts of
resource abundance? Are these effects different at the
national and local levels? How could resource booms benefit
(or harm) local communities? This paper reviews a vast
literature examining these questions, with an emphasis on
empirical works. First, the evidence and theoretical
arguments behind the so-called resource curse, and other
impacts at the country level, are reviewed. This
cross-country literature highlights the importance of
institutions. Then, a simple analytical framework is
developed to understand how resource booms could impact
local communities, and the available empirical evidence is
examined. This emerging literature exploits within-country
variation and is opening new ways to think about the
relation between natural resources and economic development.
The main message is that others factors, such as market
mechanisms and local spillovers, are also relevant for
understanding the impact of resource abundance. Finally, the
paper discusses issues related to fiscal decentralization
and provides ideas for future research.
