Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/52489
Authors: 
Arezki, Rabah
Gylfason, Thorvaldur
Year of Publication: 
2011
Series/Report no.: 
CESifo working paper: Resource and Environment Economics 3575
Abstract: 
We examine the effect of the interaction between resource rents and democracy on corruption for a panel of 29 Sub-Saharan countries during the period from 1985 to 2007. We find that higher resource rents lead to more corruption and that the effect is significantly stronger in less democratic countries. Surprisingly, we also find that higher resource rents lead to fewer internal conflicts and that less democratic countries face not a higher but a lower likelihood of conflicts following an increase in resource rents. We argue that these findings can be explained by the ability of the political elites in less democratic countries to more effectively quell the masses through redistribution of rents to the public. We support our argument by documenting that higher resource rents lead to more (less) government spending in less (more) democratic countries. Our findings suggest that the mechanisms through which resource rents affect corruption cannot be separated from political systems.
Subjects: 
resource rents
corruption
political systems
internal conflicts
JEL: 
C33
D73
D74
D72
H21
Document Type: 
Working Paper

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