Natural Resources, Conflict and Growth: Uncovering the Transmission Mechanism
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Keywords

GDP, Conflict, Resource abundance, Resource curse, Dutch disease.

How to Cite

Wizarat, S. . (2014). Natural Resources, Conflict and Growth: Uncovering the Transmission Mechanism. Asian Economic and Financial Review, 4(8), 987–1000. Retrieved from https://archive.aessweb.com/index.php/5002/article/view/1229

Abstract

Using panel data and GMM estimators for the developed countries (DCs) and the less developed countries (LDCs) we find a positive and significant impact of conflict on DC GDP and a negative and significant impact on LDC GDP during the period 1980-2009. Our result on conflict is robust irrespective of model specification and country categorization. Both fuel and ores and minerals have a positive and significant impact on GDP in the LDCs in some specifications contradicting the predominant ‘resource curse’ view. While openness has a negative and significant impact on GDP in the LDCs. Government expenditure has a negative and significant impact in DCs in one specification, which is an interesting finding in view of the social expenditure reductions in the DCs post 9/11. The use of panel data ensures that non-stationarity of the variables is not a problem and the use of GMM estimators yields estimates that are not biased on account of endogeneity.

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