Please use this identifier to cite or link to this item:
De Soysa, Indra
Krieger, Tim
Meierrieks, Daniel
Year of Publication: 
Series/Report no.: 
Diskussionsbeiträge 2020-03
We empirically examine the impact of oil wealth on property rights protection for a sample of 156 countries between 1960 and 2014. We find that higher levels of oil wealth result in weaker private property rights. This result is robust to different instrumental-variable approaches and operationalizations of oil wealth and economic institutions. We argue that oil wealth creates an oil elite that wields disproportionate economic and political power over society. The elite uses this power to buy support for weak property rights from their supporters (the selectorate), while also punishing the opposition (i.e., the non-selectorate). Indeed, we also provide evidence that oil wealth leads to more clientelistic policies (benefitting the selectorate) but also more punitive measures (e.g., in the form of exclusion from state jobs) likely administered to the non-selectorate. We argue that the elite favors weak property rights because this blocks potential economic challengers, allowing for the consolidation and perpetuation of the economic and political status quo.
oil wealth
economic institutions
property rights
resource curse
selectorate theory
Document Type: 
Working Paper

Files in This Item:
681.14 kB

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.