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Natural resource dependence and economic growth in SSA: are there threshold effects?
- Source :
- Development Studies Research; Dec2022, Vol. 9 Issue 1, p230-245, 16p
- Publication Year :
- 2022
-
Abstract
- The debate on the natural resource curse hypothesis has attracted the attention of policy makers and policy analysts for the past few decades. However, the empirical findings on such a hypothesis have proven inconclusive. Our study investigates the threshold effects of natural resource dependence on economic growth in sub-Sahara Africa (SSA) using both aggregate and disaggregate data from 1990 to 2019 by employing a threshold effect model. The results indicate a double threshold effect of natural resource rent on economic growth. In particular, below 6% of GDP, aggregate natural resource rent exerts a significant negative effect on economic growth. However, as the rents increase above 6% to about 15% of GDP its negative effect on economic growth significantly reduces. In addition, beyond 15% of GDP natural resource rent exhibit a substantial significant positive impact on economic growth. Further, the disaggregated data reveal that forest rents exhibit a strong weighty adverse effect on economic growth at all levels of thresholds. The study recommends that governments within the sub-region need to put in policies to ensure that natural resources generate at least 15% of GDP annually to promote growth. [ABSTRACT FROM AUTHOR]
- Subjects :
- NATURAL resources
ECONOMIC expansion
RESOURCE curse
ECONOMIC impact
Subjects
Details
- Language :
- English
- ISSN :
- 21665095
- Volume :
- 9
- Issue :
- 1
- Database :
- Complementary Index
- Journal :
- Development Studies Research
- Publication Type :
- Academic Journal
- Accession number :
- 160870960
- Full Text :
- https://doi.org/10.1080/21665095.2022.2112728