Citation:
Perez-Sebastian, F. ; Raveh, O. . The Natural Resource Curse And Fiscal Decentralization. American Journal of Agricultural Economicsajae 2015, 98, 212 - 230.
Date Published:
2015/08/24/Abstract:
Natural resource abundance is a blessing for some countries, but a curse for others. We show that differences across countries in the degree of fiscal decentralization can contribute to this divergent outcome. Using a large panel of countries covering several decades and various fiscal decentralization and natural resource measures, we provide empirical support for the novel hypothesis. We also study a model that combines political and market mechanisms under a unified framework to illustrate how natural resource booms may create negative effects in fiscally decentralized nations.