WIDER Discussion Papers // World Institute for Development Economics (UNU-WIDER) 2001/43
In a significant number of developing countries, revenue from the sale of a few natural resources accounts for the vast majority of export earnings and a large share of total government revenue. As a result, the allocation of revenue from natural resources is a critical political question. Tensions over the divison of natural resource exports have been repeatedly cited as a central contributor to open conflict in some countries and as the major source of political volatility in many others. In contrast, those countries that manage to develop a fair and equitable mechanism for distributing revenue have the potential to solidify national ties. This study will review the institutional structures that guide the allocation export revenue in developing countries that are heavily dependent on a few natural resource exports.