"One of the surprising features of modern economic growth is that economies with abundant natural resources have tended to grow less rapidly than natural-resource-scarce economies."

"In this paper we show that economies with a high ratio of natural resource exports to GDP in 1971 (the base year) tended to have low growth rates during the subsequent period 1971-89"

"This negative relationship holds true even after controlling for variables found to be important for economic growth, such as initial per capita income, trade policy, government efficiency, investment rates, and other variables."

"This is the phenomenon known as the Natural Resource Curse"

"Skeptics have questioned the Natural Resource Curse, pointing to examples of commodity-exporting countries that have done well and arguing that resource endowments and booms are not exogenous."

"it is best to view oil abundance as a double-edged sword, with both benefits and dangers."

"It is striking how often countries with oil or other natural resource wealth have failed to grow more rapidly than those without."

"It has been observed for some decades that the possession of oil, natural gas, or other valuable mineral deposits or natural resources does not necessarily confer economic success."

"Exports of primary products as a fraction of GDP appear on the horizontal axis and economic growth on the vertical axis. The relationship on average is slightly negative."

"In Part I, chapters 2–4, the authors assess the relationship between natural resource abundance and economic growth or the growth rate of gross domestic product (GDP) per person."

"Put bluntly, there is no resource curse."

"natural resources are neither curse nor destiny."

"conceptual disagreements over the correct measure of resource abundance"

"Subsequent developments in this debate have emphasized political economy explanations, arguing that the effect of specializing in natural resources depends on the type of resources (e.g., Isham et al. 2005) and the quality of political and economic institutions (e.g., Mehlum et al. 2006)"

"The term dependence usually refers to the structure of the economy and to what extent it depends on natural resources [e.g., captured as resource exports/gross domestic product (GDP)]."

"Here, we refer to resource abundance as the income generated by the extraction and use of minimally processed natural resources"

"the terms resource abundance or resource rich refer to the value of the natural resource endowments or the income they generate, measurable as subsoil wealth or resource rents"

"Most research has traditionally concentrated on long-term growth effects, initially finding a “resource curse.”"

"We argue that the presence of a natural resource sector per se does not necessarily translate into worse development outcomes."

"Some countries do well, and some do not. The challenge is to explain the different natural resource experiences."

"Both can change over time and so potentially turn a resource curse into a blessing, or vice versa."

"This paper adopts panel cointegration methodology to explore longer term effects than permitted using VARs."

"We find strong evidence of a resource curse."

"Commodity booms have positive short-term effects on output, but adverse long-term effects."

"The long-term effects are confined to “high-rent”, non-agricultural commodities."

"We also find that the resource curse is avoided by countries with sufficiently good institutions."

"Currently, evidence on the ‘resource curse’ yields a conundrum."

"We test the channels of the resource curse proposed in the literature and find that a substantial part of it is explained by high public and private consumption, low or inefficient total investment, and an overvalued exchange rate."

"We find that none of the transmission channels proposed in the literature individually accounts for the curse."

"However, a combination of public and private consumption, total investment, and exchange rate overvaluation explains a substantial part of it"

"It is therefore possible that the positive short-run effects are offset by a subsequent resource curse beyond the horizon of the VAR models: the post-2000 upturn would be a false dawn."

"In fact, once we control for these long-run adverse effects, resource abundance has a positive effect on average cross-country growth rates."

"The long-run coefficient is negative and statistically significant at 1 percent, consistent with a long-run resource curse effect."

"Panel data allow for the inclusion of country-specific fixed effects, which effectively control for all unobservable time-invariant country characteristics."

"Our results fully account for the cross-section results in the seminal paper by Sachs and Warner (1995)"

"A large literature suggests that there is a 'resource curse': natural resource abundant countries tend to grow slower than resource scarce countries."

"resource dependence is associated with less nonresource exports and foreign direct investment"

"Is it because resource booms induce appreciation of the real exchange rate and makes nonresource sectors less competitive (Dutch disease)"

"a resource bonanza induces appreciation of the real exchange rate, deindustrialization, and bad growth prospects"

"these adverse effects are more severe in volatile countries with bad institutions and lack of rule of law, corruption, presidential democracies, and underdeveloped financial systems"

"The key question is why resource rich economies, such as Botswana or Norway, are more successful while others perform badly despite their immense natural wealth."

"Still, many countries are cursed by natural resource wealth."

"The idea behind this Dutch disease is that the extra wealth generated by the sale of natural resources induces appreciation of the real exchange rate and an ensuing contraction of the traded sector"

"resource rich developing economies seem unable to successfully convert their depleting exhaustible resources into other productive assets."

"give detailed attention to the question why so many resource rich developing economies deviate from the so-called Hartwick rule and do not fully reinvest their resource rents in foreign"

"there is an inverse correlation between resource dependence and school enrollment at all levels, expected years of schooling, and public spending on education."

"This may matter as there is a positive correlation between education and growth."

"resource wealth is associated with less openness to foreign trade and less openness to gross foreign direct investment, which in turn may harm growth prospects."

"the share of natural resource wealth in national capital is negatively correlated with both gross domestic investment as percentage of GDP and the average ratio of broad money (M2) to GDP (a measure of financial development)."

"Another hypothesis is that a resource boom reinforces rent grabbing and civil conflict especially if institutions are bad, induces corruption especially in nondemocratic countries, and keeps in place bad policies."

"United Arab Emirates account for close to 10 percent of the world's crude oil and 4 percent of the world's natural gas reserves but has turned its resource curse into a Blessing"

"a contraction or stagnation of other tradable sectors of the economy; and to be accompanied by an appreciation of the country’s real exchange rate"

"such changes in the structure of production should be welfare improving, reflecting changes in demand associated with an improvement in national income."

"the real exchange rate appreciation that is a part of Dutch disease is an equilibrium phenomenon that reflects a change in underlying fundamentals."

"long-term, growth-enhancing qualities (such as the presence of positive technological spillovers, learning by doing effects, or increasing returns to scale in production)."

"the economy would struggle to rebuild sources of growth upon depletion of its natural resource."

"If the natural resource sector is not inferior in terms of its growth potential, then this sectoral shift would be of similar import to the canonical displacement of agriculture by manufacturing...."

"The influential studies by Sachs and Warner (1995, 2001) are representative of a stream of literature that finds that natural resource abundance has a strong negative impact on growth."

"an increase of 10 percentage points in the ratio of natural resource exports to GDP in a cross-section of countries during 1970–90 was associated with reduced manufactured export growth (figure 3) and with as much as 0.4–0.7 percentage points lower annual per capita growth in GDP."

"Lederman and Maloney (2007) challenge the robustness of these findings on a number of grounds, including the econometric drawbacks associated with the use of cross-section data and the need for a measure of natural resource abundance better grounded in economic theory."

"They also argue that productivity growth in services or the natural resource sector may not be inferior to that in manufacturing, and they question whether manufacturing really possesses such special characteristics."

"Mehlum, Moene, and Torvik (2006) suggest that, in countries with "grabber-friendly" institutions, a natural resource boom will lead to a shift out of productive activity into unproductive rent seeking."

"In countries with "producer-friendly" institutions, on the other hand, a natural resource boom attracts resources to move into productive activity."

"the negative impact of natural resources on growth steadily falls as institutional quality increases. When institutional quality is sufficiently high, the natural resource effect becomes positive."

"the quality of existing institutions conditions the quality of economic policies that countries use to deal with natural resource abundance"

"Collier and Goderis (2007), however, does not find statistically significant evidence that natural resources directly worsen governance or institutional quality"

"When a country suddenly discovers a big natural resources asset—whether it be fossil fuels, minerals, or something else—there can be an influx of highly paid international workers from multinational oil and gas or mining companies. That boosts local economies temporarily, but it can also cause the local currency to rise in a way that disadvantages locals working in other sectors."

"Dutch disease is when a country’s currency rises in response to a windfall in one area of the economy, causing other areas to suffer."

"Dutch disease is an example of the resource curse, in which a country’s economy underperforms despite having substantial natural resources."

"Enhanced industry diversification can help a country break a resource curse."

"The broader affliction can be exacerbated by a strong currency, as with Dutch disease, but that isn’t the only factor. Corruption, armed conflict, boom-and-bust commodity cycles, and the legacy of extractive colonialism can also contribute to poorer economic growth and development in resource-rich countries whose economies aren’t well diversified."

"When a country has a significantly valuable natural resource, it can be tempting for its leaders to go whole hog into developing that commodity at the expense of other industries."

"This approach can lead to a situation similar to Dutch disease, where a wealth gap develops between workers in industries that extract natural resources and those in other segments of the economy. Corruption can exacerbate the problem if national leaders siphon off wealth for themselves, fostering authoritarianism and eroding trust from international investors."

"Little consensus exists on the effect of natural resource richness on economic growth and the mechanism underlying the effect."

"No consensus answer, however, has yet emerged"

"40% of empirical papers finding a negative effect"

"40% finding no effect"

"20% finding a positive effect"

"After reviewing the apparently mixed results reported in the literature"

"it matters for the results"

"data period under investigation, treatment of institutions, control for investment, definition of natural resources"

"It concludes with recommendations—aimed at national governments, national and international civil society, international bodies, and the extractive industry— on how best to escape the resource curse."

"As discussed, many countries with an abundance of natural resources do not suffer from the resource curse. They have been able to harness their resources in such a way that almost the entire population benefits from the rents obtained from exploitation"

"Certain recommendations, when adopted, could help sub-Saharan countries now facing the resource curse reverse the predicament."

"These recommendations could serve as guidelines for sub-Saharan nations that have discovered new reserves of natural resources to avoid the curse."

"Despite the downsides, the benefits from the extraction and use of natural resources are considerable. Apart from advancing economic and technological development across the globe, the exploitation of resources could have significant benefits for local communities because it generates employment opportunities. Furthermore, the rents received from properly managed exploitation can be used to develop physical infrastructure in the resource-rich country for the benefit of all. The Involvement of local communities in the exploitation process could improve citizen participation in decision-making and contribute to better institution-building."

"After examining the underlying causes of the resource curse in sub-Saharan Africa, this paper laid out several recommendations for reversing and avoiding the curse. These include regulating compulsory consultative dialogues with all stakeholders in the preparatory phase of extraction consignments, taking practical and structural measures to combat corruption, properly regulating land and property rights, and establishing an effective judicial system in the countries concerned."

"It is recommended that all resource-rich countries regulate consultative dialogues with stakeholders in a flexible but binding legal framework. Communities could then rely on the adopted framework in the event of any possible exploitation of a natural resource within the community. The need for such a document lies in the fact that it is not always easy to foresee who the stakeholders are in certain situations."

"participating in existing anticorruption initiatives such as those undertaken by Transparency International and the Extractive Industry Transparency Initiative."

"Furthermore, because land disputes are often the source of conflict in the region, it is recommended that necessary measures are taken to prevent such disputes and to peacefully resolve existing related conflicts."

"Land ownership is a key factor in any economy because it confers property rights and defines access to and control of Land assets, including natural resources that exist in or on land."

"Reliance on the exploitation of natural resources alone for the advancement of the economy is risky and a limited economic strategy"