Preprint Article Version 1 This version is not peer-reviewed

Economic Diversity and the Resource Curse: A Dynamic Panel Model

Version 1 : Received: 13 April 2018 / Approved: 13 April 2018 / Online: 13 April 2018 (14:18:36 CEST)

How to cite: Olayele, F.; Soo, K. Economic Diversity and the Resource Curse: A Dynamic Panel Model. Preprints 2018, 2018040179 (doi: 10.20944/preprints201804.0179.v1). Olayele, F.; Soo, K. Economic Diversity and the Resource Curse: A Dynamic Panel Model. Preprints 2018, 2018040179 (doi: 10.20944/preprints201804.0179.v1).

Abstract

This paper contributes to the debate on the impact of economic diversity and the resource curse on economic growth. We use dynamic panel data models on data on Canadian and US sub-national jurisdictions. We find evidence for a positive relationship between diversity and growth. Based on the Krugman Specialization Index, our analysis shows that the required threshold for not having the resource curse is 0.209. Above this threshold, the marginal contribution of natural resources to economic growth is lower for a more diversified regional economy than a less diversified one. We highlight the policy implications of these findings.

Subject Areas

Diversity; resource curse; economic growth.

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