Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/146248 
Year of Publication: 
2016
Series/Report no.: 
WIDER Working Paper No. 2016/57
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
We evaluate the effect of natural resources on political regimes. We use the synthetic control method to compare evolution of the democracy level of countries affected by giant oil discoveries with the weighted democracy level of countries that do not incur the same event and have similar pre-event characteristics. Focusing on 12 countries affected by the peak of oil discovery from the 1970s, we find that the exogenous variation in oil endowment does not have the same effect on all countries. In most of cases, the event has a negative effect in the long run, but countries with a high level of democracy in the pre-event period are not affected by the peak of oil discoveries. These results support heterogeneity and non-linearities claimed in the more recent theoretical literature.
Subjects: 
natural resources
oil discoveries
democracy
synthetic control method
JEL: 
C21
C23
O57
P48
Persistent Identifier of the first edition: 
ISBN: 
978-92-9256-100-0
Document Type: 
Working Paper

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