Natural Resource Revenues and Public Investment in Resource-rich Economies in Sub-Saharan AfricaShow others and affiliations
2017 (English)In: Review of Development Economics, ISSN 1363-6669, E-ISSN 1467-9361, Vol. 21, no 4, p. 107-130Article in journal (Refereed) Published
Abstract [en]
The general policy prescription for resource-rich countries is that, for sustainable consumption, a greater percentage of the windfall from resource rents should be channeled into accumulating foreign assets such as a sovereign public fund as done in Norway and other developed but resource-rich countries. This might not be a correct policy prescription for resource-rich sub-Saharan African (SSA) countries, where public capital is very low to support the needed economic growth. In such countries, rents from resources serve as an opportunity to scale-up the needed public capital. Using a panel data for the period 1990–2013, we find in line with the scaling-up hypothesis that resource rents significantly increases public investment in SSA and that this tends to depend on the quality of political institutions. Moreover, we also find evidence of a positive effect of public investment on economic growth, which also depends on the level of resource rents.
Place, publisher, year, edition, pages
John Wiley & Sons, 2017. Vol. 21, no 4, p. 107-130
National Category
Economics
Identifiers
URN: urn:nbn:se:ltu:diva-88384DOI: 10.1111/rode.12313ISI: 000423410200006Scopus ID: 2-s2.0-85015222920OAI: oai:DiVA.org:ltu-88384DiVA, id: diva2:1619652
Note
Funder: United Nations University World Institute for Development Economics Research (UNU-WIDER)
2021-12-132021-12-132022-04-04Bibliographically approved