The natural resource lever looks better when there isn't much to move

Tim Stuhldreher: A little natural resource boom can do wonders for your economy, at least in the short term, provided you have a small population and not much other economic activity...

Niger uranium mining dispute a test case for use of African natural resources

The Guardian: The wrangle between Niger and a state-owned French firm over payments for uranium extraction has wider ramifications

Public capital in resource rich economies: is there a curse?

Bhattacharyya and Collier in Oxford Economic Papers: As poor countries deplete their natural resources, for increased consumption to be sustainable some of the revenues should be invested in other public assets. Further, since such countries typically have acute shortages of public capital, the finance from resource depletion is an opportunity for needed public investment. Using a new global panel dataset on public capital and resource rents covering the period 1970 to 2005 we find that, contrary to these expectations, resource rents significantly reduce the public capital stock. This is more direct evidence for a policy-based ‘resource curse’ than the conventional, indirect evidence from the relationships between resource endowments, growth and income. The adverse effect on public capital is mitigated by good institutions. We also find that rents from the depletion of non-renewable (mineral) resources reduce the public capital stock whereas rents from sustainable (forestry and agriculture) sources do not.

Oil and gas perspectives in the 21st century

Special Issue of Energy Policy including articles on:

• The end of Peak Oil? Why this topic is still relevant despite recent denials
• A blessing in disguise: The implications of high global oil prices for the North American market
• The European framework for energy and climate policies

Brazil’s oil euphoria hits reality hard

Washington Post: When fields said to hold billions of barrels of oil were discovered off the coast here, exuberant government officials said the deep-sea prize would turn Brazil into a major energy player. More than six years later, the outlook for Brazil’s oil industry, much like the Brazilian economy itself, is more sobering. Oil production is stagnant, the state-controlled oil company, Petrobras, is hobbled by debt, and foreign oil companies are wary of investing here...

Natural resource curse: a non linear approach in a panel of oil exporting countries

MPRA: This paper explores the idea of regime switching as a new methodological approach to bring new insights into the natural resource curse hypothesis in the case of oil exporting countries. The basic idea is that when a threshold of oil dependence is passed, the relationship between economic growth and its determinants could move smoothly from a regime to another. Relying upon the estimation of a PSTR model, our findings offer strong evidence that oil revenues non-linearly impacts economic growth and that resource curse only exists under the condition of high oil dependence. More precisely, below the level of 51% of oil dependence, oil revenues have a positive impact on economic growth, whereas above this level, it have serious drawbacks on economic growth through inefficiencies into the quality and the quantity of government expenditures.

Conflict and Coexistence in the Extractive Industries

Chatham House: Clashes over the terms of mineral contracts have become a political lightning rod in many resource-rich countries. A series of bitter disputes in recent years – some ending in lengthy litigation, project cancellation or even expropriation – has unsettled investors and global markets. These disputes call attention to the fragile and complex relationship between companies and their host governments that characterizes the extractives sector...