The illusory leader: natural resources, taxation and accountability

Abstract

This paper proposes and tests a mechanism through which natural resources can affect democracy. I posit that, in the presence of high natural resource rents, leaders lower the burden of taxation on citizens in order to reduce the demand for democratic accountability. The theory is corroborated using micro-level data from public opinion surveys across 15 sub-Saharan countries, in addition to country-level data on natural resource rents. Results are robust to a range of alternative specifications. A supplementary analysis reveals that, consistent with the two-period model proposed, the effects are more acute closer to national elections.

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Correspondence to Eoin F. McGuirk.

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McGuirk, E.F. The illusory leader: natural resources, taxation and accountability. Public Choice 154, 285–313 (2013). https://doi.org/10.1007/s11127-011-9820-0

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Keywords

  • Democracy
  • Political economy
  • Natural resources
  • Curses
  • Africa

JEL Classification

  • D73
  • O13
  • O55