Summary
Peace Research and Conflict Management - Summary and notes class 6
- Course
- Institution
Summary of 5 pages for the course Peace Research and Conflict Management at KU Leuven (Summary of class 6)
[Show more]
Seller
Followelisenizette
Reviews received
Content preview
Class 6 – Natural resources abundance and conflictThe resource curse
- The paradox of plenty: an abundance of natural resources leads to lower economic
growth
o Economists have called this phenomenon the ‘resource curse’ or ‘governance
curse’
o Abundance of natural resources also associated with
§ Higher corrup,on rates
§ Higher poverty rates
§ More authoritarian rule & lower levels of democracy
§ Armed conflict
o Concept or ‘resource curse’ is some,mes used to refer to both the economic
and poli,cal consequences
- How can an abundance of natural resources damage economies and turn out to be a
‘curse’?
o Economic disrup,ons lead to economic growth failure and ins,tu,onal failure:
created by the resource abundance and all of it as a result leads to conflicts
o Several mechanisms have been suggested to explain the rela,onship between
resource abundance & growth failure
§ Vola,lity in government revenues could lead to macroeconomic
instability
• When more dependent on resources, income will fluctuate:
nega,ve rela,onship natural resources and growth rates
• The more dependent on natural resources, the less democracy
• More dependent on export of natural resources, higher risk of
conflict
§ Remove incen,ves to develop good ins,tu,ons
§ Proclivity for armed conflicts
§ Dutch disease
• Discovery of natural resources and its abundance increases
exports of these resources and the value that they have to pay
for other products increases as well
§ GRAPHS
Dutch disease
= a situa,on where an expansion of the natural resource sector leads to the shrinkage of other
tradable industries through an overvalua,on of a country’s exchange rate
27
, - Economic term for the nega,ve consequences that can arise from a spike in the value
of a na,on’s currency
o Associated with new discovery or exploita,on of valuable natural resource and
unexpected repurcussions
- Two economic effects:
o Decreases price compe,,veness of exports of affected country’s manufactured
goods
o Increases imports
- Example: the Netherlands
o The Netherlands has a lot of gas. The Netherlands started to export gas
interna,onally. The export of the gas led to the overvalua,on of the currency.
Gulden became more expensive for other countries to buy. As a result, the
products became more expensive, which led to all kinds of social and economic
problems. E.g. having oil will led to the massive increase in primary export
revenue. Apprecia,on of exchange rate leads to more expensive exports.
Decrease in world demand for non- oil products: as a result, exporters of non-
oil products produce less. Reduc,on in the income and employment of the
non-oil export industries.
Resource abundance and conflict
- Since mid-1990s natural resources have also been associated with a higher risk of
armed conflict
o Natural resources played an important role in a number of armed conflicts in
the 1990s
o Research by Collier and Hoeffler
- Natural resources and conflict
o Ongoing debate
§ Academic debate about the link between NR and violent conflict
§ Central ques,ons
28
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller elisenizette. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.88. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
82871 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now