Oil,Growth, and Health: What Does the Cross‐Country Evidence Really Show?* |
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Authors: | Anca M Cotet Kevin K Tsui |
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Institution: | 1. Seton Hall University, , South Orange, NJ, 07079 USA;2. Clemson University, , Clemson, SC, 29634 USA |
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Abstract: | We show that previous results from the body of literature on the resource curse have primarily been driven by the collapse in oil prices during the mid‐1980s. By exploiting cross‐country variations in the size of initial oil endowments and the timing of oil discoveries, we find that there is a stable positive relationship between oil abundance and long‐run economic growth. Using dynamic panel data methods, we also find that there is no evidence that higher oil rents hinder growth. However, to focus on material gain means that the welfare gain from oil is understated, because oil‐rich countries benefit more by the reduction in infant mortality and the gain in longevity. Interestingly, such oil‐led health improvements are more pronounced in non‐democratic countries, where initial heath conditions were poor and oil wealth is concentrated among the ruling elites. |
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Keywords: | Oil discoveries oil‐led health improvements resource curse O11 O13 O47 Q32 |
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