Resource abundance and economic growth in the United States

Elissaios Papyrakis, Reyer Gerlagh

Research output: Contribution to journalArticlepeer-review

355 Citations (Scopus)


It is a common assumption that regions within the same country converge to approximately the same steady-state income levels. The so-called absolute convergence hypothesis focuses on initial income levels to account for the variability in income growth among regions. Empirical data seem to support the absolute convergence hypothesis for US states, but the data also show that natural resource abundance is a significant negative determinant of growth. We find that natural resource abundance decreases investment, schooling, openness, and R&D expenditure and increases corruption, and we show that these effects can fully explain the negative effect of natural resource abundance on growth.
Original languageEnglish
Pages (from-to)1011-1039
Number of pages29
JournalEuropean Economic Review
Issue number4
Publication statusPublished - 2007

Cite this