The resource curse hypothesis and its transmission channels

Elissaios Papyrakis, Reyer Gerlagh

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415 Citations (Scopus)

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.
Original languageEnglish
Pages (from-to)181-193
Number of pages13
JournalJournal of Comparative Economics
Volume32
Issue number1
DOIs
Publication statusPublished - 2004

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