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Do Natural Resources Fuel Authoritarianism? A Reappraisal of the Resource Curse

Published online by Cambridge University Press:  27 January 2011

STEPHEN HABER*
Affiliation:
Stanford University
VICTOR MENALDO*
Affiliation:
University of Washington
*
Stephen Haber is A.A. and Jeanne Welch Milligan Professor of Political Science and Peter and Helen Bing Senior Fellow, Hoover Institution, Stanford University, 434 Galvez Mall, Stanford, CA 94305 (haber@stanford.edu).
Victor Menaldo is Assistant Professor of Political Science, University of Washington, 101 Gowen Hall, Seattle, WA 98105 (vmenaldo@u.washington.edu).

Abstract

A large body of scholarship finds a negative relationship between natural resources and democracy. Extant cross-country regressions, however, assume random effects and are run on panel datasets with relatively short time dimensions. Because natural resource reliance is not an exogenous variable, this is not an effective strategy for uncovering causal relationships. Numerous sources of bias may be driving the results, the most serious of which is omitted variable bias induced by unobserved country-specific and time-invariant heterogeneity. To address these problems, we develop unique historical datasets, employ time-series centric techniques, and operationalize explicitly specified counterfactuals. We test to see if there is a long-run relationship between resource reliance and regime type within countries over time, both on a country-by-country basis and across several different panels. We find that increases in resource reliance are not associated with authoritarianism. In fact, in many specifications we generate results that suggest a resource blessing.

Type
Research Article
Copyright
Copyright © American Political Science Association 2011

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