Abstract
The resource curse has been mainly studied using cross-country samples. In this paper we analyze a cross-province sample from one country: China. We focus on the interplay between resource abundance, institutional quality, and economic growth, using two different measures of resource abundance (a stock: resource reserves; and a flow: resource revenues), and employing various econometric approaches including varying coefficient models. We find that resource abundance has a positive effect on economic growth at the provincial level in China between 1990 and 2008, an effect that depends nonlinearly on institutional quality (1995 confidence in courts). The ‘West China Development Drive’ policy, initiated in 2000, caused substantial changes, which we investigate through a comparative panel-data analysis.
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We are grateful to Thorsten Beck, Erwin Bulte, Pavel Čížek, Reyer Gerlagh, Harry Huizinga, Charles van Marrewijk, Daan van Soest, and seminar participants at Tilburg University for useful comments; to Ying Fang and Yang Zhao for stimulating us to investigate this topic and sharing institutional data; and to two referees for constructive comments.
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Ji, K., Magnus, J.R. & Wang, W. Natural Resources, Institutional Quality, and Economic Growth in China. Environ Resource Econ 57, 323–343 (2014). https://doi.org/10.1007/s10640-013-9673-8
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DOI: https://doi.org/10.1007/s10640-013-9673-8
Keywords
- Natural resource curse
- Economic growth
- China
- Institutional quality
- Resource abundance
- Policy change
- Functional effect