Abstract
Progress in child mortality reduction and education attainment varies widely among oil-rich countries. We investigate the sources of this variation for 14 oil-rich countries and find five main factors: public spending on health and education, economic growth, caloric sufficiency, initial levels of child mortality and education attainment, and population density. We find that conditional convergence explains much of the cross-country variation in the rate of decline in child mortality and the rate of increase in school enrollment. As for policy factors, the level of caloric sufficiency makes a difference, whereas the contribution of public spending is not as important.
Similar content being viewed by others
Notes
The absolute log changes of both child mortality and school enrollment between 1980 and 2014 are positive for all sample countries. The average absolute log change over this sample period is 1.21 for child mortality and 0.62 for school enrollment.
The sample size is 79 for child mortality and 78 for school enrollment. The sample size is restricted by data availability on either the dependent variable or any of the independent variables. To check whether our results are not influenced by the sample composition, we present in Tables 17 (child mortality) and 18 (school enrollment) of the appendix differences in baseline variables of interest between sample and non-sample countries. The results show that for both health and education regressions, the difference between sample and non-sample countries is small and statistically insignificant except for control of corruption.
When we use average GDP per capita instead we also find that countries with higher levels of income per capita tend to experience faster reductions in child mortality and faster increases in school enrollment.
Alternatively, using urbanization instead of population density provides very similar results, but the coefficient on Health spending per capita is no longer statistically significant at conventional levels.
The OECD countries that are excluded from the full sample are the following: Australia, Belgium, Canada, Denmark, France, Germany, Italy, Mexico, UK, USA.
As an alternative to the TSLS estimator, we also present the results from a panel specification using the System GMM estimator in Table 13 in the appendix.
When we use the Gulf Cooperation Council (GCC) countries instead, we get a stronger effect. The coefficient increases from 0.370 [s.e = 0.123] to 0.554 [s.e. = 0.221]. But this stronger effect is unlikely to be related to oil resources, given that the coefficient on the oil-rich dummy is statistically insignificant.
We also interact the oil resource dummy with other regressors in both the health and education equations. The results show that the coefficients on these interactions are not statistically significant (Table 14).
This country-level growth accounting exercise follows the approach used in Barro (1996).
References
Asadullah MN, Savoia A (2018) Poverty reduction during 1990–2013: did millennium development goals adoption and state capacity matter? World Dev 105(2018):70–82
Baldacci E, Clements B, Gupta S, Cui Q (2008) Social spending, human capital, and growth in developing countries. World Dev 36(8):1317–1341
Barro R (1996) Determinants of economic growth: a cross-country empirical study. NBER Working Paper No. 5698
Beck T, Demirguc-Kunt A, Levine R (2003) Law and finance: why does legal origin matter? J Comp Econ 31(4):653–675
Bhattacharya S, Hodler R (2010) Natural resources, democracy and corruption. Eur Econ Rev 54(4):608–621
Bockstette V, Chanda A, Putterman L (2002) States and markets: the advantage of an early start. J Econ Growth 7(4):347–369
Caselli F, Michaels G (2013) Do oil windfalls improve living standards? Evidence from Brazil. Am Econ J Appl Econ 5(1):208–238
Chaudhury N, Hammer J, Kremer M, Muralidharan K, Rogers H (2006) Missing in action: teacher and health worker absence in developing countries. J Econ Perspect 20(1):91–116
Corden WM, Neary JP (1982) booming sector and de-industrialisation in a small open economy. Econ J 92(368):825–848
Cutler D, Deaton A, Lleras-Muney A (2006) The determinants of mortality. J Econ Perspect 20(3):97–120
Deaton A (1999) Commodity prices and growth in Africa. J Econ Perspect 13(3):23–40
Easterly E (2009) How the millennium development goals are unfair to Africa. World Dev 37(1):26–35
Edwards R (2016) Mining away the preston curve. World Dev 78(2016):22–36
Filmer D, Pritchett L (1999) The impact of public spending on health: does money matter? Soc Sci Med 49(10):1309–1323
Goldin C, Katz L (1997) Why the United States led in education: lessons from secondary school expansion, 1910 to 1940, Working Paper 6144, National Bureau of Economic Research, Cambridge. Mass
Gupta S, Verhoeven M, Tiongson E (2002) The effectiveness of government spending on education and health care in developing and transition economies. Eur J Polit Econ 18:717–737
Gylfason T (2001) Natural resources, education, and economic development. Eur Econ Rev 45(4–6):847–859
Iqbal F, Kiendrebeogo Y (2015) Public spending and education attainment in the middle east and North Africa. Rev Middle East Econ Finance 11(2):99–118
Iqbal F, Kiendrebeogo Y (2016) The determinants of child mortality reduction in the middle east and North Africa. Middle East Dev J 8(2):230–247
Iqbal F (2006) Sustaining gains in poverty reduction and human development in the middle east and north Africa, World Bank, Washington D.C
Kronfol N (2012) Historical development of health systems in the Arab countries: a review. East Mediterr Health J 18(11):1151–1156
La Porta R, Lopez-de-Silanes F, Shleifer A, Vishny RW (1997) Legal determinants of external finance. J Finance 52(3):1131–1150
La Porta R, Lopez-de-Silanes F, Shleifer A, Vishny RW (1998) Law and finance. J Polit Econ 106(6):1113–1155
La Porta R, Lopez-de-Silanes F, Shleifer A, Vishny RW (1999) The quality of government. J Law Econ Organ 15(1):222–279
La Porta R, Lopez-de-Silanes F, Shleifer A, Vishny RW (2008) The economic consequences of legal origins. J Econ Lit 46(2):285–332
Lange S, Klasen S (2017) How the new international goal for child mortality is unfair to Sub-Saharan Africa (Again). World Dev 90(2017):128–146
Mauro P (1995) Corruption and growth. Quart J Econ 110(3):681–712
McGuire J (2006) Basic health care provision and under-5 mortality: a cross-national study of developing countries. World Dev 34(3):405–425
Norman C (2009) Rule of law and the resource curse: abundance versus intensity. Environ Resour Econ 43(2009):183–207
Pelletier D, Frongillo E (2003) Changes in child survival are strongly associated with changes in malnutrition in developing Countries. J Nutr 133(1):107–119
Pritchett L, Summers L (1996) Wealthier is healthier. J Hum Resour 31(4):841–868
Rajkumar A, Swaroop V (2008) Public spending and outcomes: does governance matter? J Dev Econ 86:96–111
Ross M (2001) Does oil hinder democracy? World Polit 53(3):325–361
Sala-i-Martin X (1996) The classical approach to convergence analysis. Econ J 106(437):1019–1036
Solow R (1956) A contribution to the theory of economic growth. Quart J Econ 70:65–94
Vicente PC (2010) does oil corrupt? Evidence from a natural experiment in West Africa. J Dev Econ 92(1):28–38
Wang L (2002) Determinants of child mortality in LDCs: empirical findings from demographic and health surveys. Health Policy 65:277–299
Acknowledgements
We are grateful to Shanta Devarajan, David Evans, and seminar participants at the London School of Economics for helpful comments
Author information
Authors and Affiliations
Corresponding author
Additional information
Publisher's Note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Rights and permissions
About this article
Cite this article
Kiendrebeogo, Y., Iqbal, F. Resource curse for human development?. Econ Change Restruct 55, 1173–1206 (2022). https://doi.org/10.1007/s10644-021-09342-8
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10644-021-09342-8