Natural Resource Abundance and Economic Performance—A Literature Review

Abstract

It would be a major error to take the decade of the 1970s as the prototype for minerals-based development. The resource curse hypothesis seems anomalous as development economics, since on the surface it has no clear policy implication, but stands as a sad prediction. Minerals are not a curse at all in the sense of inevitability; the curse, where it exists, is self-fulfilling. Needless to say, policies and institutions have to be framed to local circumstances, country by country. But with good intentions and innovative thinking, there is no reason why resource-rich countries need fall prey to the curse.