Publication: Natural Resources : Neither Curse nor Destiny
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Published
2007
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2012-06-05
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This volume studies the role of natural resources in development and economic diversification. It brings together a variety of analytical perspectives, ranging from econometric analyses of economic growth to historical studies of successful development experiences in countries with abundant natural resources.
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“Lederman, Daniel; Maloney, William F.. 2007. Natural Resources : Neither Curse nor Destiny. © World Bank. http://hdl.handle.net/10986/7183 License: CC BY 3.0 IGO.”
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Publication In Search of the Missing Resource Curse(World Bank, Washington, DC, 2008-11)The debate over the curse of natural resources has haunted developing countries for decades if not centuries. A review of existing empirical evidence suggests that the curse remains elusive. The fragile negative effect of natural resources on economic growth might be due to international heterogeneity in the effects of natural resources on economic growth, to the use of weak indicators of natural resources that might be unrelated to relative natural-resource endowments, or to the inability of econometric analysis based on international data to capture historical processes. This paper defends an empirical proxy for relative abundance of natural resources, which is based on standard growth theory. In turn, various econometric estimations are hopelessly deployed in the search for the missing resource curse. Some evidence suggests that natural resources might have large positive effects whose true magnitude remains unknown due to unresolved econometric issues.Publication Labor Demand and Trade Reform in Latin America(World Bank, Washington, DC, 2000-11)There are concerns that trade reform and globalization will increase the uncertainty that the average worker, especially the relatively unskilled worker, faces. The increased competitiveness of product markets and greater access to foreign inputs, the argument goes, will lead to more elastic demand for workers. This may have adverse consequences for both labor market volatility and wage dispersion. The authors argue that while the case that trade liberalization should increase own-wage elasticities may be broadly compelling for competitive import-competing industries, it is less so for imperfectly competitive, nontradable, or export industries. They test the hypothesis using establishment-level panel data from three countries with periods of liberalization. The data provide only mixed support for the idea that trade liberalization has an impact on own-wage elasticities. No consistent patterns emerge. If globalization is making the lives of workers more insecure, it is probably working through some other mechanism.Publication Outcomes, Opportunity and Development : Why Unequal Opportunities and Not Outcomes Hinder Economic Development(World Bank, Washington, DC, 2013-12)This paper studies the relationship between inequality of opportunity and development outcomes in a cross-country setting. Scholars have long debated the impact of inequality on growth, development, and the quality of institutions in a society. The empirical relationships are however confounded by the notion that "inequality" can be seen as a composite of inequality arising from differences in effort and ability, which would tend to encourage competition and productivity, and inequality attributable to unequal opportunities, particularly in terms of access to basic goods and services, which might translate to wasted human potential and lower levels of development. The analysis in this paper applies a measure of educational opportunities that incorporates inequality between "types" or circumstance groups. Theories from economic history are used to instrument for this type of inequality in a large cross-country dataset. The results seem to confirm the hypothesis that this measure of inequality of opportunity is a better fit for structural inequality than the Gini index of income. The results suggest that inequality of endowments at the outset of history led to unequal educational opportunities, which in turn affected development outcomes such as institutional quality, infant mortality, and economic growth. The findings are robust to several checks on the instrumental variable specification.Publication Trade Structure and Growth(World Bank, Washington, DC, 2003-04)Lederman and Maloney examine the empirical relationships between trade structure and economic growth, particularly the influence of natural resource abundance, export concentration, and intra-industry trade. They test the robustness of these relationships across proxies, control variables, and estimation techniques. The authors find trade variables to be important determinants of growth, especially natural resource abundance and export concentration. In contrast with much of the recent literature, natural resource abundance appears to have a positive effect on growth, whereas export concentration hampers growth, even after controlling for physical and human capital accumulation, among other factors.Publication Explaining Local Manufacturing Growth in Chile : The Advantages of Sectoral Diversity(2011-12-01)This paper investigates whether the agglomeration of economic activity in regional clusters affects long-run manufacturing total factor productivity growth in an emerging market context. It explores a large firm-level panel dataset for Chile during a period characterized by high growth rates and rising regional income inequality (1992-2004). The findings are clear-cut. Locations with greater concentration of a particular sector did not experience faster growth in total factor productivity during this period. Rather, local sector diversity was associated with higher long-run growth in total factor productivity. However, there is no evidence that the diversity effect was driven by the local interaction with a set of suppliers and/or clients. The authors interpret this as evidence that agglomeration economies are driven by other factors, such as the sharing of access to specialized inputs not provided solely by a single sector, such as skills or financing.
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