INTL 1101 Lecture Notes - Lecture 35: Resource Curse, Good Governance, Exchange Rate
31 Aug 2016
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Document Summary
Countries are dependent upon this oil for development. Correlation between abundant mineral resources and a series of negative economic performance and authoritarian regimes. Also examples of countries that have squandered their mineral wealth and actually made their citizens worse off. Domestic private ownership would foster institutions that more effectively constrain state leaders, encourage them to invest in institution building, and enable them to respond more successfully to commodity booms and busts. Mineral-rich countries have consistently underperformed their mineral-poor counterparts on a variety of economic and political indicators, including economic performance, good governance, income equality and democracy. The more intense a country"s reliance on mineral exports is the more slowly its economy grows. Mineral exporters were more likely to incur greater debt. Commit a significant percentage of their gdp to debt servicing. Mineral wealth is strongly correlated with poor governance and high levels of corruption.
